3Q12 Results November, 2012

Decrease of 12% in SAIDI and 10% in SAIFI

- Both below the regulatory limits, as a result of the Action Plan

0.4% decrease in energy consumption

Investments of R$ 225 million, a 10% increase

Gross revenues totaled R$ 3,757 million, a 5% decrease

Reorganization and restructuring costs of R$ 34 million in the quarter

Ebitda of R$ 108 million in the 3Q12, a reduction of 83%

Net income of R$ 14 million, a 96% decrease

.

Financial

3Q12 Highlights

Operational

2

On July 4th, 2012, it was applied the index of tariff review (economic effect: – 5.60%) and tariff adjustment (economic effect: +4.45%), with average combined effect of -3.25%

On September, 11th 2012, the Energy Costs Reduction Program was announced; through the Provisional Measure 579, that does not directly affect the Company, since its concession was granted after 1995

Regulatory

Restructuring of all Company’s debts with the flexibility of covenants, increase maturity from 6.6 years to 7.2 years and reduction of average costs from CDI + 1.29% p.a. to CDI + 1.27% p.a.

Debt

MP 579: Context

Financial impact between tariff adjustments of hydrological risks due to the allocation of energy quotas

Marginal benefits in collection and potential decrease in delinquency, since energy costs will be reduced Increase in energy consumption, as a potential result of the drop in tariffs Exchange rate variation of the price of energy purchased from Itaipu will no longer be suportted by distribution companies, but by Eletrobras

3

Opportunities

Risks

Aims to reduce tariffs by 20% (Residential: 16.2% and industrial from 20% to 28%), as from February 2013, through: - Decreasing sector charges (RGR, CCC e CDE): - 7% - Renewal of Generation and Transmission Concessions: - 13%

Goal

AES Eletropaulo is not covered by MP 579 rules and has a concession valid until 2028

4

Tariff review: discussions with Aneel

Aneel excluded R$ 728 million from shielded RAB, due to the decrease in the amount of cables between the accounting records and the shielded RAB, between cycles

Shielded RAB was approved by Aneel in 2003 and was confirmed in 2007, considering a global consistency criteria

If the exclusion of the amount of cables is maintained, an addition of R$ 660 million of assets in operation (2003 BRR) should be considered

Aneel did not recognize a R$ 427 million investment performed in the incremental period on Minor Components to Main Equipments (“COM”) and Additional Costs (“CA”)

Aneel changed the benchmark company proposed in the Public Hearing, modifying the regulatory losses from 0.49% to 1%

Adequacy of the regulatory standards applied by Aneel for the valuation of real costs incurred in execution of works and recorded in accounting books

Benchmark company is an outlier Regulatory losses shall be restored to the

previous number of 0.49%

Shielded RAB

Investments

Losses

Arguments Discussion

5

Consumption evolution (GWh)¹

Consumption impacted by industrial production slowdown and migration of commercial clients to free market

1 – Own consumption not considered

Residential Industrial Commercial Public Sector and Others

Captive Market Free Clientes Total Market

4,257

1,531

2,811

708

9,307

2,097

11,404

4,331

1,489

2,809

731

9,360

1,998

11,357

3Q11 3Q12

+1.7% -2.7% -0.1% +3.2% +0.6% -4.7% -0.4%

6

Best SAIDI since 2006 and within regulatory limits

SAIDI¹ (last 12 months)

1 - System Average Interruption Duration Index Source: ANEEL and AES Eletropaulo

SAIDI (hours)SAIDI (hours)

SAIDI Aneel Reference

-22%

SAIDI¹ (YTD)

- 16%

2009 2010 2011 3Q11 3Q12

11.8610.60 10.36 10.30

8.67

10.099.32

8.68

Jan-Sep/11 Jan-Sep/12

7.806.11

► ANEEL Reference for 2012 SAIDI: 8.67 hours

7

SAIFI remains below the regulatory limits

SAIFI ¹ (last 12 months)

1- System Average Interruption Frequency Index Source: ANEEL and AES Eletropaulo

SAIFI (times)

SAIFI Aneel Reference SAIFI (times)

-16%

SAIFI¹ (YTD)

-12%

2009 2010 2011 3Q11 3Q12

6.175.46 5.45 5.42

4.79

7.87 7.39 6.93

Jan-Sep/11 Jan-Sep/12

4.05 3.38

► ANEEL Reference for 2012 SAIFI: 6.87 times

8 1 – In January 2012, the Company improved the assessment of the technical losses, which were decreased to a level of 6.1%. The number for the last twelve months ended in 3Q12 is 6.2% 2 – Values estimated by the Company to make them comparable with the reference for non-technical losses determined by the Aneel

Regulatory Reference² - Total Losses (last 12 months)

Losses level close to the regulatory reference for the 3rd Cycle of Tariff Reset

Losses (last 12 months)

2011/2012 2012/2013 2013/2014 2014/2015

10.7 10.3 9.8 9.4

2009 2010 2011 3Q11 3Q12

6.5 6.5 6.5 6.5 6.2

5.3 4.4 4.0 4.1 4.2

11.8 10.9 10.5 10.6 10.4

Technical Losses ¹ Non Technical Losses

0

100

200

300

400

500

600

700

800

2010 2011 2012(e) 1Q11 1Q12

654 717794

198 213

2822

46

6 11

682739 841

205 225

Own Resources Paid by the clients

9

+10%

Investments mainly focused on system expansion, maintenance and quality of client services

Investments (R$ million) 3Q12 Investments (R$ million)

¹

1 – Maintenance capex is the investment s made for the grid modernization and improvement in quality of service

Maintenance

Client Service

System Expansion

Losses Recovery

IT

Paid by the Clients

Others

141

137

154

202526

75

53

49

569

1011

37

3T12 9M12

R$ 579 million R$ 225 million

9M11 9M12 3Q11 3Q12

6,839 6,804

2,348 2,232

532 579

208 227

4,032 4,046

1,380 1,298

11,403 11,429

3,937 3,757

Net revenue ex-construction revenue

Construction revenues

Deduction to Gross Revenue 10

Gross Revenues (R$ million)

Revenues variation reflects the new tariff and industrial activity slowdown

-5%

+0.2%

9M11 9M12 3Q11 3Q12

4,2204,936

1,520 1,749

893

1,133

186358

5,113

6,068

1,7062,107

Energy Supply and Transmission Charges PMS² and Others Expenses

11

+23%

+19%

1 - Depreciation and other operating income and expenses are not included 2 - Personnel, Material and Services

Higher average cost of energy purchased due to energy from auctions and exchange rate

Operating Costs and Expenses ¹ (R$ million)

12

Manageable PMSO items below the inflation

PMS and other expenses (R$ million)

1 – Reversal of tax and labor contingencies and changes in accounting criteria for ADA 2 – Change in PMSO, excluding Pension Fund, collective bargaining and fleet maintenance 3 – Public lighting points (PMSP agreement) with reversion expected for 4Q12 and IT costs

3Q11 Non recurring 3Q11¹

3Q11: ex non recurring

Pensionplan

Collective bargaining

Vehicles mainten. and

others²

3Q12 Costs of reorganization

and restructuring

Non recurring 3Q12³

3Q12: ex nonrecurring

186 186

277 277 289 308 308 308343 358

90 1211

9 34

15

13

Ebitda (R$ million)

Ebitda reduction due to the tariff review and costs with reorganization and restructuring

1 – PMSO variation, excluding costs with reorganization and restructuring and non-recurring costs related to the 3Q11 and 3Q12

3Q11 Market and tariff review

and adjustment at Parcel B

Non recurring 3Q11 and 3Q12

Parcel A Others revenues and

expenses

Costs with reorganization

and restructuring

PMSO¹ 3Q12

642

378 272 210 174 108

(264)

(105)

(63)(36)

(34)(32)

012 8

Financial Results (R$ million)

14

Recurring financial results benefited by exchange rate and lower interest rate

Financial Results (R$ million) - ex non-recurring¹

- 33%

(50)

¹ Non-recurring items: R$ 54,3 million corresponding to the Finsocial recorded in 3Q11and recognition of R$ 18,5 million due to inflation adjustment of lawsuit involving PIS credit

(54) (69)

(43)

(11)

- 19%

9M11 9M12 3Q11 3Q12

9M11 9M12 3Q11 3Q12

(17)

15

Net Income (R$ million)

Net income variation due to tariff review and costs with reorganization and restructuring

-80%

-96%

(258)

(260)

(103) (20)

9M11 9M12 3Q11 3Q12

Net Income - AdjustedRegulatory assets and liabilities variationTariff review postponement effect

561269 51

142182

699 182

885181

348

14

3Q11 3Q12

735363

3Q11 3Q12

878 932

-51% +6%

13

Operational Cash Generation (R$ million) Final Cash Balance (R$ million)

Lower cash generation due to tariff review and higher cost of energy purchased and charges

2013 2014 2015 2016 2017 2018 2019 2020 -2028

52 83 178

587476

686

321 40086 44

47

5154

58

62

732

138 128225

637530

744

383

1.133

2013 2014 2015 2016 2017 2018 2019 2020 -2028

302533

228337

226436

321 400

86

44

4751

54

5862

732

388

578

275387

280

494383

1.133

Debt refinancing conclusion of R$ 1 billion resulting in more flexible covenants

17

• Increase in the average debt maturity from 6.6 years to 7.2 years

• Debt average costs decrease from 1.29% to 1.27%

• More flexible covenants

Benefits

Debt amortization schedule

After restructuring R$ 1,241 million R$ 491 million

Before restructuring

M

Debt in R$ (ex-pension plan debt )

Pension plan debt

M

Debt in R$ (ex-pension plan debt )

Pension plan debt

More flexible covenants and considering IFRS changes

Gross debt / Adjusted Ebitda < 3.5 Financial Index

FROM

Net debt / Adjusted Ebitda < 3.5 (equivalent to 4.5x Gross Debt / Adjusted Ebitda)

TO

If the limit is exceeded in any quarter Default If the limit is exceeded for two consecutive quarters

Not considered in the calculation Regulatory assets and liabilities

Considered in the calculation (concept before IFRS adoption)

Total debt recognized in liabilities Pension plan debt

Debt recognized in liabilities excluding the “corridor” concept

Considered in the calculation of debt

Compulsory loans

Out of debt calculation

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.

3Q12 Results