2. Disclaimer
This presentation may contain statements that represent expectations about future events or results according to Brazilian
and international securities regulators. These statements are based on certain assumptions and analyses made by the
Company pursuant t it experience and th economic environment, market conditions and expected f t
C t to its i d the i i t k t diti d t d future events, many
t
of which are beyond the Company's control. Important factors that could lead to significant differences between actual
results and expectations about future events or results include the Company's business strategy, Brazilian and international
economic conditions, technology, financial strategy, developments in the utilities industry, hydrological conditions, financial
market conditions uncertainty regarding the results of future operations plans objectives expectations and intentions
conditions, operations, plans, objectives, intentions,
among others. Considering these factors, the Company's actual results may differ materially from those indicated or implied
in forward-looking statements about future events or results.
The information and opinions contained herein should not be construed as a recommendation to potential investors and no
investment decision should be based on the truthfulness, timeliness or completeness of such information or opinions. None
of the advisors to the company or parties related to them or their representatives shall be liable for any losses that may
result from the use or contents of this presentation.
This material includes forward-looking statements subject to risks and uncertainties which are based on current
forward looking uncertainties,
expectations and projections about future events and trends that may affect the Company's business. These statements
may include projections of economic growth, demand, energy supply, as well as information about its competitive position,
the regulatory environment, potential growth opportunities and other matters. Many factors could adversely affect the
est ates a d assu pt o s o
estimates and assumptions on which these statements are based.
c t ese state e ts a e based
2
4. Corporate overview – Highlights
1st private player in the electric sector in terms of M k Cap
t i l Market C
The largest (R$ 22 billion in Mar, 2011)
private player R$ 3.4 billion EBITDA and R$ 1.6 billion Net Income in 2010
in the Brazilian
Electric Sector Main player in Renewable Energy in Latin America
Leadership in the distribution business through 8
distributors. Energy market is concentrated in t e most
d bu o gy a co ce t ated the ost
developed regions of Brazil
2,640 MW(e) generation installed capacity in FY11,
93% renewable sources. 17 wind farms, 5 biomass
plants and 1 S
Small Power Plant under construction
ll P Pl t d t ti
Successful strategy in the commercialization business
Bovespa’s
B ’ Novo Mercado and NYSE’s ADR Level III
d NYSE’
Differentiated Dividend Policy: minimum 50% of the net
income semi-annually. Practices 95%
Most sustainable electricity company in Latin America for the
3rd consecutive year by Management & Excellence
4
5. Brazilian’s largest player in the electric setor
CPFL Energia | 2010 Market-share
ALIZATION
Distribution CPFL 13%1
Concession Area (captive + TUSD)
COMMERCIA
• 6.7 million customers
Others:
• 569 municipalities 87%
• Sales of 52,378 GWh2
3 major
Market leader players
p y : 34%
Generation (Aug, 11e) CPFL 2%3
Focused mainly in renewables
• 60 power plants operating Others:
ON
2,640
2 640 MW installed capacity
GENERATIO
• 98%
• 19 plants under construction
3 major
3rd private generator players: 28%
Comercialization
DISTRIBUTION
N
CPFL 11%4
Energy free market and Services
• 152 free customers
• Sales of 13,000 GWh Others:
• Services: revenues of R$ 120 million
$ 89%
D
2nd player 3 major
players: 30%
5 1) Aneel – last available information 2) Concession area sales (excludes CCEE) 3) In Apr, 2011. Generation figures after ERSA and Jantus’ deals closing 4) In Feb, 2011
6. Current Corporate Structure
Notes: (1) Includes the 0.1% stake of the company Camargo Corrêa S.A.; (2) Controlling shareholders; (3) Comprises 13 companies: Santa Clara I, II, III, IV, V and VI, Eurus VI,
6 Campo dos Ventos I, II, III, IV and V and Eurus V.
7. Best corporate governance practices
Advanced Corporate Governance Practices:
1st Brazilian company
• Shares listed on differentiated segments:
• Bovespa Novo Mercado
• ADR III - NYSE Annual Client Leadership
Award IFC 2008
• Compliance with the Sarbanes-Oxley Act
• Board of Directors made up of 7 members:
• 1 Independent Member
I d d tM b Member of the Companies
• 3 Board Advisory Committees Circle – OCDE/IFC
• Self-Assessment through Fiscal Council
• General Shareholders Meeting Participation Manual
• Securities Information Disclosure and Trading Manual 1st Place
Energy Sector – The Most Sustainable Large
• Dividend Payout Policy: Companies in Latin America for the 3rd consecutive
• Minimum dividends of 50% of net income, paid twice a year year
May,
May 2011
• Succession Plan
Ranked on the 50 Largest Sustainable Latin
American companies list (2008/2009)
Ranked on Ibovespa’s Transparency in
Sustainability list of companies (2nd place - 2009)
y p ( p )
7
8.
9. Comparative of global electricity consumption
Electricity consumption | per capita/GDP1
14.000
12.000
000 United
onsumption pe capita (KWh)
)
States
10.000 Australia
8.000 Japan
France
er
Taiwan
T i
Singapure Germany
6.000
South Korea UK
Greece Spain
Brazil Italy Hong Kong
4.000 Venezuela
2014 Portugal
Chile
Brasil
Co
Argentina
2.000 2010
China Mexico
Peru
GDP per
5.000 10.000 15.000 20.000 25.000 30.000 35.000 40.000 capita (US$)
Brazil 2010 2014 2019 ∆ %
Population (million)2 194.1 200.2 206.6 12.5 6
Electricity consumption (TWh)
y p ( ) 415.9 506.8 633.0 217.1 52
Consumption per capita (MWh/year) 2.1 2.5 3.0 0.9 46
9 1) Source: U.S Energy Information Administration 2) Source: PDE 2019
11. Capex – Investments in the distribution and generation business
Investments by business segment (in R$ million)
Total 1997-2005: R$ 3,2 billion
Total 2006 2010 R$ 6,2 billion
T l 2006-2010: 6 2 billi 1.773
1 773
645
1.316
1.167
1.121
570
445 502
793
606 627 266
565
512 1128
255
331 343
294 746
676 665
193 220 191 527
157 174 32 39 368
193 218 235 261
157 174 188 152
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Distribution Generation
11
12. 12 Doesn’t include the figures of Jantus and ERSA’s deals
13. 1Q11 Debt Profile
The largest
private player
in the Brazilian TJLP | 31%
Electric Sector
1) Excludes Judicial Deposits of R$ 493 million – includes hedging operations; excludes regulatory assets/liabilities; EBITDA (LTM) 2) Includes debts from Santa Clara I, II III, IV, V,
13 VI and Eurus VI; Includes BITDA (LTM)(e) from CPFL Bioenergia, EPASA and Foz do Chapecó
14. Capital market performance
14 1) Closing price in March 31th, 2011 – adjusted per dividends (CPFE3: R$ 45,40/CPL: US$ 85.61) 2) Closing price not adjusted per dividends
15. TSR Performance
Total Shareholder Return1 - 2005-2010(e) [% a.a.2]
25%
21%
20% 19%
17% 17% 16%
Average3 = 14
4%
3%
AES Tietê
Ti ê Copel
C l Tractebel
T b l Cemig
C i Light
Li h AES Edp
Ed Eletrobras
El b
Eletropaulo
Note: 2010 dividends estimates from a research report (Itaú) 1) TSR: shareholder TIR – market cap values in Dec, 04 and Dec, 10.
15 2) Values updated by IGP-M 3) Source: Thomson Financial; Economática and Itaú Securities
17. 17
CPPFL CPFL
4,5
Moc
coca
4,6
Mococa
CP
PFL CPFL Santa
5,1
Paulista
5,5
Cruz
CPFFL CPFL
5,2
Piratini
inga
5,7
Paulista
FEC1 | 2010
DEC1 | 2010
Eletropa
aulo CPFL
5,4
6,9
Piratininga
Coe
elce
5,6
Coelce
7,5
Elek
ktro CPFL Leste
5,7
8,3
Paulista
Li
ight
5,8
Escelsa
9,0
Esc elsa CPFL Sul
6,3
9,2
Paulista
CPFL Santa CPFL
6,5
z
Cruz
9,2
Jaguari
Ce
emig
6,6
Elektro
9,5
Cos
sern
7,0
Eletropaulo
10,6
Bandeira
ante
7,1
Light
Ce
elpe
7,3
73
Copel
CPFL Leste
L
7,7
77
Paulis
sta Bandeirante
11,3 11,5 12,2
CPFL Sul
L
7,8
78
Paulista Cosern
C
CPFL
7,8
78
Jaguari Cemig
Operational Efficiency – Distribution companies
opel
Co
9,5
Celesc
12,7 13,0 13,5
R
RGE
9,7
RGE
14,7
AES Sul Celpe
17,1
Cel
lesc
,
10,1 10,2
AES Sul
17 1 18,0
Coe
elba
11,2
Cemar
Am
mpla
12,7
CEEE
21,5 21,6
Cem
mar
14,0
Ampla
1) DEC-Duration of outages per consumer per year (in hours); FEC-Frequency of outages per consumer per year (number of outages). Excluding power outage effect in Nov, 09.
23,8
CE
EEE
15,0
Coelba
26,6
18. Operational Efficiency – Distribution companies
Delinquency1 (%) | CPFL Energia
Apr, 10 1Q11
Q
Dec,
Dec 09
1,52 1,42
1,16
Mar, 08 Jun, 08 Sep, 08 Dec, 08 Mar, 09 Jun, 09 Sep, 09 Dec, 09 Mar, 10 Jun, 10 Sep, 10 Feb,11
Program f R d ti
P for Reduction of C
f Commercial L
i l Losses
2007 – 2010
2 million of consumer units (CU) inspected
• 305 thousand CU identified and regularized
• 211 thousand CU with fraud
• 413 thousand measuring equipments replaced
• 37 thousand regularization of illegal connections
18 1) Bills overdue more than 30 days - % of 12 months billings. In 2010 it doesn’t consider: CPFL Leste Paulista, Sul Paulista, Jaguari and Mococac
19. CPFL Energia Group’s Awards
Abradee
Best Electric Energy Distribution Economic-Financial Management:
Company in Brazil: CPFL Paulista – 1999|2000|2008
CPFL Paulista–2000|2003|2006|2008|2009
Paulista 2000|2003|2006|2008|2009 CPFL Piratininga – 2004|2007
RGE – 2010
Management Quality:
Best Electric Energy Distribution CPFL Paulista – 2005|2006|2008|2009
Company in the South Region CPFL Piratininga – 2010
RGE – 2003|2009|2010
Best Social Responsibility:
Operational Management: CPFL Paulista – 2002|2003|2004|2005|2008
CPFL Paulista – 2001|2003|2005|2007|2008 RGE – 2009|2010
RGE – 2010
PNQ® – National Quality Award
Awarded Awarded Finalist
19
23. CPFL Energias Renováveis | Portfólio
CPFL Renováveis | Projects into commercial operation - Aug, 11(e)
á
Preliminary figures. It depends on approval by competent bodies 1) Source: ERSA (IR) 2) Includes SIIF Énergies Brazil's assets 3) Assured energy/guaranteed power output
23 4) Expectation to increase 0.8 avg.MW after review by ANEEL 5) Considers review of Varginha SPP’s assured energy by ANEEL in April 20, 2011
24. CPFL Energias Renováveis | Portfolio
Installed capacity (MW) Installed capacity
Assured energy (AvgMW) 3,341 4,375 (Total: 4,375 MW)
SPP
18%
1,359 1,832 Bio
36%
386 Wind
648 306 45%
167
Operating (Aug, 11) Under Under Total
construction development
4,375 Assured Energy
Estimated Evolution
(Total 1,832 AvgMW)
Installed capacity (MW)
Assured energy (AvgMW) SPP
2,092
2 092 25%
1,692 1,832
1,174 Bio
907 742 920 31%
648 410 538 Wind
306
44%
2011 2012 2013 2014 2015 Total
24
25. Expansion in Generation | Acquisition of 1,078 MW in wind farms in Mar, 11
210 MW in operating and 867 MW for development
Note: Load factor – estimates values according to historical production and certification 1) Excludes additional investment of R$ 70 million in case of Quintanilha Machados’s
25 acquisition 2) Proinfa PPA: as of June, 2010 Note: Illustrative picture
28. Generation – Termonordeste TPP commercial startup in Dec, 2010 and
Termoparaíba TPP in Jan, 2011
Epasa TPPs – CPFL Stake (51%)
• Installed Capacity: 174.2 MW
• Investment: R$ 310 million
• Capital structure: ~35% equity / 65% debt
• Location: Paraíba
Start of Commercial Start-up:
construction Termonordeste: Dec, 10
Oct, 09 Termoparaíba: Jan, 11
Annual fixed revenue around of R$ 85 million
28
29. Expansion in Generation | Projects under construction
Sugarcane – fired termoelectric power plants
29 1) As of Mar, 11
30. Expansion in Generation | Projects under construction
Wind farms
30 Note: Illustrative picture 1) As for Mar, 11 2) Guaranteed power output
31. Expansion in Generation | Installed capacity growth
1) Guarantee of 51.54% of the assured energy until 2028 2) Hydroelectric power projects with less than 1,000 Kw that are not considered concession by the grantor
31 3) From 9 SPPs from CPFL Jaguariúna (today are in the Distribution), 6 are in the situation described in note 2
32. Brazilian generation – expansion
Northeast
• Wind potential
North
• Local thermal
• High hydro-
generation (LNG)
eletric potential
available • Nuclear
• Thermal
generation using
Wind potential: 75 GW2
imported coal
Potential used: 5%
Hydro potential: 111 GW1
Potential used: 9%
South Southeast/CO
• Local thermal • Local thermal
generation using generation
domestic coal (biomass, pre-salt
and LNG)
p g
• Developing
Wind potential: 23 GW1 wind potential Biomass potential:
Potential used: 3% 23 GW3
32 1) Source: MME 2) Source: EPE. Consider the energy contracted until 2013 3) Source: COGEN (expected by 2019)
