Sustainability Report

Transcription

Sustainability
Report
2006
Presentation
AES Eletropaulo relates, in the next pages,
Edifício Brasiliana
the activities and events that marked the
Rua Lourenço Marques 158
Company’s operations during the course of
04547 100 São Paulo SP
2006, a year of major accomplishments. In
this Annual Sustainability Report, we sought to
www.eletropaulo.com.br
gather the main information about our work,
which was translated into economic, financial,
social and environmental results.
Enjoy your reading!
Sustainability
Report
2006
Presentation
Enjoy your reading!
94
2003
19,114
98
2004
22,351
98
2005
21,753
1,490
1,606
1,677
1,896
1,936
2.1
16.0
10.0
12.0
22.0
12.4
-10.4 p.p.
8,354
8,297
7,394
6,432
5,781
2006
2005
2004
2003
2002
1,936.0
1,896.0
1,677.0
1,606.0
1,490.0
2.1
1.5
2006
114
2002
15,812
18,466
-18.8
2005
5.52
21,753
6.8
Private Social Investments – R$ thousand
2005
6.4
2004
6.9
Responsibility VP
Global RI
Working Team
Sustainability Consultancy
Contents Ana Cristina da
TheMediaGroup
Conceição Mariana Paes Manso Alves
BSD Brasil
Corporate Image Luiz Vaz
Carlos Rafael Tanjioni Daniel Di Prinzio
Graphic Design
Social Responsibility
TheMediaGroup
[email protected]
Photography
Investor Relations
AES Collection
Clarice Silva Assis Maria Carolina
Daniel Rosa
F. Gonçalves Patrícia Zucarelli
[email protected]
Environment Demóstenes Barbosa
22,351
8.7
2003
-13.5
Number of Customers – million
19,114
7.87
text and translation
Miranda Neto José Luiz Simionato
2002
9.1
Maria Angela Jabur Communication & Social
da Silva Gianpaola Ciniglio Raphael
15,812
8.9
2006
8.2
Coordination of content,
[email protected]
5.5
11.1
Editorial Cordination
Sergio Akira Maryama
Economic Productivity
R$ thousand/employee
2006
0.13
3,096
2004
32,668
4,410
7,408
1,167
2004
697
697
2004
Net Debt/Adjusted Ebitda
2005
2.06
3,046
2003
32,774
4,006
8,181
1,262
2003
864
864
2003
2006
2003
103
5.1
2006 Chg% 06/05
18,466
-15.1
2002
* Adjusted Ebitda = Ebitda + Liability Expenses on FCESP + RTE + Extraordinary Items
+2.5
+16.5
8.92
4,560
9.0
2006 Chg% 06/05
31,656
0.1
4,316
-1.4
7,335
1.5
1,267
4.7
2006 Chg% 06/05
17
-98.9
1,890
57.6
2006 Chg% 06/05
5.0%
5.3
-20.82
1,088
2002
32,451
3,881
8,362
1,292
2002
218
218
2002
+38.9
-3.72
4,184
2005
31,634
4,377
7,227
1,210
2005
1,592
1,199
2005
63.0%
2005
+35.1
16.0%
3.0
+1.6
Credits
2.0%
2004
+180.0
14.0%
5.1
-66.7
11,351
1.8
8,354
0.7
6,904
-7.6
1,450
75.8
1,763
57.1
2,491
16.7
-369
15.7
373
NA
2006 Chg% 06/05
21.1
7.6 p.p.
29.8
4.1 p.p.
4.5
NA
2006 Chg% 06/05
12,451
0.6
2,196
12.3
4,830
-4.8
1.6
4.4 p.p.
3,658
-19.8
1.7
-26.1
1.5
-28.6
378
-6.4
2006 Chg% 06/05
2004
11,154
8,297
7,471
825
1,122
2,134
-319
-156
2005
13.5
25.7
NA
2005
12,372
1,955
5,075
6.0
4,562
2.3
2.1
404
2005
2005
3.3
9,981
7,394
6,346
1,048
1,317
1,718
-594
-28
2004
17.8
23.2
NA
2004
12,821
2,198
5,284
17.0
5,091
2.3
3.0
330
2004
2006 Chg% 06/05
2003
8,649
6,432
5,637
795
1,060
1,472
24
86
2003
16.5
22.9
1.34
2003
12,724
2,193
5,278
38.0
4,829
2.2
3.3
218
2003
Financial institutions
5.1
7,636
5,781
5,184
598
849
1,436
-1,394
-871
2002
14.7
24.8
NA
2002
12,952
2,106
5,902
47.0
5,610
2.7
3.9
180
2002
and other adjustments
2003
2005
Shareholders
3.9
2004
Accounting of losses 2002
2003
Payroll
5.0
2002
Net Operating Revenue – R$ million
Government 2002
Controlling Company Results
(R$ million)
Gross operating revenues
Net operating revenues
Operating expenses and charges
Result from service rendered (ebit)
Ebitda
Adjusted Ebitda*
Net financial income (expense)
Net income/loss
Margins (%)
Ebitda margin
Adjusted Ebitda margin*
Net margin
Financial Indicators (R$ million)
Fixed assets
Shareholders’ equity
Gross debt
Gross debt – foreign currency (%)
Net debt
Net debt/Equity (times)
Net debt/Adjusted Ebitda (times)
Investments in Fixed Assets*
Stock Market Indicators
Market price return at Bovespa –
preferred shares (%)
PN
PNA
PNB
Earnings (Loss) per thousand shares (R$)
Market Capitalization (R$ million)
Operational Indicators
Market (GWh)
Number of employees
Productivity (MWh/employee)
No. consumers/No. employees
Environmental Indicators
Investments in operations (R$ thousand)
External projects (R$ thousand)
Quality Indicators
Equivalent Duration of Interruption
per Consumer Unit (DEC) (hours)
Equivalent Frequency of Interruption
per Consumer Unit (FEC) (hours)
Average Time of Service (TMA) (minutes)
Social Indicators
Private social investments (R$ thousand)
Economic productivity
(R$ thousand/employee)
% of women in management positions
Added Value Distribution
2004
Sustainability Highlights
94
2003
19,114
98
2004
22,351
98
2005
21,753
1,490
1,606
1,677
1,896
1,936
2.1
16.0
10.0
12.0
22.0
12.4
-10.4 p.p.
8,354
8,297
7,394
6,432
5,781
2006
2005
2004
2003
2002
1,936.0
1,896.0
1,677.0
1,606.0
1,490.0
2.1
1.5
2006
114
2002
15,812
18,466
-18.8
2005
5.52
21,753
6.8
2005
6.4
2004
6.9
Responsibility VP
Global RI
Working Team
TheMediaGroup
BSD Brasil
Graphic Design
TheMediaGroup
[email protected]
Photography
Investor Relations
AES Collection
Daniel Rosa
[email protected]
22,351
8.7
2003
-13.5
19,114
7.87
2002
9.1
15,812
8.9
2006
8.2
[email protected]
5.5
11.1
2006
0.13
3,096
2004
32,668
4,410
7,408
1,167
2004
697
697
2004
2005
2.06
3,046
2003
32,774
4,006
8,181
1,262
2003
864
864
2003
2006
2003
103
5.1
2006 Chg% 06/05
18,466
-15.1
2002
+2.5
+16.5
8.92
4,560
9.0
2006 Chg% 06/05
31,656
0.1
4,316
-1.4
7,335
1.5
1,267
4.7
2006 Chg% 06/05
17
-98.9
1,890
57.6
2006 Chg% 06/05
5.0%
5.3
-20.82
1,088
2002
32,451
3,881
8,362
1,292
2002
218
218
2002
+38.9
-3.72
4,184
2005
31,634
4,377
7,227
1,210
2005
1,592
1,199
2005
63.0%
2005
+35.1
16.0%
3.0
+1.6
Credits
2.0%
2004
+180.0
14.0%
5.1
-66.7
11,351
1.8
8,354
0.7
6,904
-7.6
1,450
75.8
1,763
57.1
2,491
16.7
-369
15.7
373
NA
2006 Chg% 06/05
21.1
7.6 p.p.
29.8
4.1 p.p.
4.5
NA
2006 Chg% 06/05
12,451
0.6
2,196
12.3
4,830
-4.8
1.6
4.4 p.p.
3,658
-19.8
1.7
-26.1
1.5
-28.6
378
-6.4
2006 Chg% 06/05
2004
11,154
8,297
7,471
825
1,122
2,134
-319
-156
2005
13.5
25.7
NA
2005
12,372
1,955
5,075
6.0
4,562
2.3
2.1
404
2005
2005
3.3
9,981
7,394
6,346
1,048
1,317
1,718
-594
-28
2004
17.8
23.2
NA
2004
12,821
2,198
5,284
17.0
5,091
2.3
3.0
330
2004
2006 Chg% 06/05
2003
8,649
6,432
5,637
795
1,060
1,472
24
86
2003
16.5
22.9
1.34
2003
12,724
2,193
5,278
38.0
4,829
2.2
3.3
218
2003
5.1
7,636
5,781
5,184
598
849
1,436
-1,394
-871
2002
14.7
24.8
NA
2002
12,952
2,106
5,902
47.0
5,610
2.7
3.9
180
2002
2003
2005
Shareholders
3.9
2004
2003
Payroll
5.0
2002
Government 2002
(R$ million)
Ebitda
Adjusted Ebitda*
Net income/loss
Margins (%)
Ebitda margin
Net margin
Fixed assets
Gross debt
Net debt
PN
PNA
PNB
Market (GWh)
Number of employees
Quality Indicators
Social Indicators
2004
2006
Sustainability Report
Profile 2
Methodology 4
Message from the CEO 8
Corporate Governance 11
Sector Environment 15
Operating Activities 18
Capital Expenditures 23
Health and Safety 31
Business Management 34
Environmental Management 45
Social Management 54
Risk Management 65
Investment in Intangible Assets 68
Economic and Financial Performance 70
Our Shares as an Investment 77
Strategies and Outlook 83
Sustainability Indicators 85
Added Value Statement 87
GRI Index 88
Corporate Information 93
Financial Statements appendix
Perfil
Profile
AES Eletropaulo supplies electric power
population – who live in its concession area.
to 24 municipalities in the metropolitan region
These people consume 35% of all the energy
of São Paulo, including the state capital, one
produced in São Paulo State, a consumption
of the major economic and financial centers in
density of 8,436.4 MWh/km2.
the country. The largest electricity distributor in
2.8
South America in terms of sales, the Company has
a concession area that covers 4,526 km2, is densely
To meet this demand, AES Eletropaulo
populated and concentrates the greatest portion
maintains a structure containing 148 substations
of the Brazilian GDP per capita.
and a network of overhead and underground
2.1
2.2
2.7
cables of more than 42,269 kilometers long.
In 2006, this infrastructure made it possible
Every day its 4,316 employees work to distribute
the electric power essential to business development
5.5 million registered clients and brought a
and the operation of services like health care, cultural
gross operating revenue of R$11.4 billion and
activities, education, public security and leisure. In
a net revenue of R$8.4 billion.
other words, AES Eletropaulo provides better quality
of life to about 16 million people – 9% of the Brazilian
for the Company to supply 38,183 GWh to
2.8
AES Eletropaulo’s history goes back to the
VALUES
incorporation of the Canadian company The São
Paulo Tramway, Light and Power Co. Ltd. on April
7, 1899. By Executive Order of President Campos
Safety
AES group will always prioritize safety – for
Salles, it received a permit to operate in the
its employees, outsourced personnel and the
country on July 17 of the same year. Since then,
members of the communities served.
the history of the Company has been following
the development of the city of São Paulo. The
Brazilian government took over the Company
Integrity
AES people are honest, trustworthy and
through Eletrobrás in 1979. Two years later,
reliable. Integrity is at the core of all they do, how
the São Paulo State Government bought out the
they conduct their activities, perform their duties,
company, which was renamed Eletropaulo.
and interact with one another and all of their
The Company was bought by Lightgás, a
stakeholders.
consortium composed of AES Corporation,
Companhia Siderúrgica Nacional (CSN),
Eletricité de France (EDF) and Reliant Energy,
Commitment
AES group is committed to its stakeholders
at a privatization auction in 1998. North
(customers, employees, communities,
American AES Corporation, one of the largest
shareholders, suppliers and partners) and wants
power suppliers worldwide with operations in 26
its businesses to make a positive contribution to
countries, has been the controlling shareholder of
society.
AES Eletropaulo since 2001. With shares listed on
the São Paulo Stock Exchange and Level 1 ADRs
traded internationally, AES Eletropaulo has been
Excellence
AES group strive to be the best in all it does.
listed, since 2004, under Level 2 of Bovespa’s
The group performs at world-class levels and
Corporate Governance Standards.
provides reliable, high-quality services to its
2.8
2.5
customers.
Self-fulfillment
VISION
To be acknowledged as the leading brand in
the industry.
AES group wants its employees to enjoy what
they do and appreciate the sense of fulfillment
they get from being part of a successful team that
makes a difference. People work because they feel
MISSION
fulfilled, useful and motivated.
To meet society’s needs by providing energy
services and solutions in a safe and sociallyresponsible manner.
4.8
Methodology
AES Eletropaulo’s 2006 Annual Report
brings an innovation as a result of the decision
not stringently divided into different fields,
to concentrate and put together economic,
such as operations, administrative, economic-
environmental and social information in a
financial, social or environmental management,
Sustainability Report.
since the routines in these areas are overlap in
This initiative is based on the belief that
corporate activity. Commercial activities, for
the sustainability and survivability of the core
instance, include relationship with customers.
business – providing a utility – rests on three
Business Management, in turn, is based on
pillars: social development, the preservation of the
the improvement of the company atmosphere,
environment and sound economic and financial
just as operating activities always depend on
practices, factors that should be incorporated into
environmental factors, as well as the interaction
the Company’s daily routine.
with the community and with local authorities.
In line with this principle, AES Eletropaulo has
This integration and interdependence show AES
been regularly investing in the pursuit of operating
Eletropaulo’s commitment to operating in a
excellence, with a view to distributing electricity
socially and environmentally responsible manner.
in a safe and socially responsible manner.
Consequently, this document includes information
related to the Company’s management practices,
as well as the economic, financial, social and
operating data integrated with the Company’s
performance in the Social Responsibility and
Environmental areas.
The issues addressed in this Report are
3.1
“The vision of
sustainability
of AES Eletropaulo and of the other companies of AES group rests on an economic
pillar, a social pillar and an environmental pillar, the three of which act and
interact with one another. Viewed through this prism, the Company activities are
based on sound economic and financial practices, with a view to contributing
to the social development of the areas in which it operates as well as preserving
the environment, maintaining and restoring the natural resources tapped in its
activities. The Company believes that the balance between these factors will ensure
the sustainability and the continuity of its core business, which is providing a utility
service, namely power generati0n, to society in a responsible manner.”
AES companies in Brazil work towards
joint initiative of the United Nations Environment
continuously improving the reports of their social
Program (Unep) and of the non-governmental
and environment-oriented actions and practices, a
organization Ceres (Coalition for Environmentally
firm commitment to sustainable development that
Responsible Economies) to raise the standards
is reinforced by the fact that the group basically
of sustainability reports to a level equivalent
deals with renewable energy.
to that of financial reports. With this in mind,
In line with this vision, two years ago a
investors, market analysts and the organized
decision was taken to progressively adhere to
civil society are expected to start considering not
the guidelines laid down by the Global Reporting
only economic and financial information but also
Initiative (GRI), an organization that proposes
social and environmental data in their corporate
the only model for sustainability reports that is
performance assessments.
accepted worldwide. GRI was created in 1997 as a
3.11
Sustainability is the key point of this Annual Report, which is geared to the
following stakeholders of AES Eletropaulo:
Main focus
investors, financial institutions, electric energy regulatory agencies, Third Sector
organizations and government bodies in Brazil;
Other stakeholders
employees, customers, community, suppliers, press and universities.
The main focus was determined based on the major demand from these
stakeholders for information on the Company.
3.6
4.14
The guidelines for the preparation of GRI
reports also seek to integrate a range of initiatives
in line with sustainable development, such as
codes of conduct, the Global Pact, performance
standards (SA 8000), governance standards
(OECD – Organization for Economic Co-operation
and Development), management systems (ISO)
among others.
Adherence to the international model is a
voluntary act. Furthermore, it is essential that
adherence to these practices follow a stage of
planning, structuring and commitment of the
Corporation as a whole. The level of awareness
brought about by these practices will be
demonstrated throughout this report.
The aim of the Company in following GRI
guidelines is to publish a Report that provides
accurate sustainability information that can be
compared and used in practice. The application
level of this Report is C (self-declared). In order to
start a process of ongoing improvement, the BSD/
Report RELATA© tool was used in 2006 to assess
the social and environmental information.
3.5
1. Regularization of electric
connections in Heliópolis
2. Preventive maintenance is
essential for the good operation
of the distribution network
3. Control panel of
AES Eletropaulo’s
Operations Center
1.1.
2.
3.
Eduardo José Bernini
Chief Executive Officer
Message from the CEO
The restructuring process of AES companies
in Brazil started in September 2003 and reached
not result in such positive indicators without
maturity in 2006. This is seen in the results of
the restructuring effort the Company has
AES Eletropaulo, AES Sul, AES Tietê and
been engaged in since 2003, with the ultimate
AES Uruguaiana, whose overall net income
goal to consolidate the credibility of the AES
amounted to over R$1 billion last year.
group in Brazil through better results for all its
The good corporate performance in 2006
can be mainly attributed to measures such as
stakeholders.
The strategy involved administrative
the shareholding restructuring, debt reduction
restructuring (redistribution of the decision-
and the extension of debt maturity, coupled with
making power, creation of business areas and
the strict cost control and continuous efforts
teamwork incentive), a financial restructuring and
to increase revenues. The external situation,
enhanced operations and services.
with more stable rules for the electricity sector
(consolidated in the new model) and the upsurge
in power consumption, also contributed to the
positive results.
Nevertheless, these factors alone would
A continuous effort to revive and consolidate
A clear example of this synergy is the
corporate image, both to internal and external
investment on Research and Development focused
stakeholders, is just as noteworthy. Also considered
on environmental responsibility and work safety.
a strategic priority, it was based on specific action
Moreover, projects that encourage the sensible
and the incorporation, by all 5,500 employees of
and safe use of energy, which results in economy
AES group in Brazil, of values (ethics, transparency
and greater competitiveness for customers, as
and proactivity) and practices geared to social and
well as the preservation of the environment, are
economic development and the sustainable use of
developed in the Energy Efficiency Program.
natural resources.
Another example is AES Eletropaulo’s Program
The most important factor for this result
for the Regularization of Electricity Connections,
– and the greatest highlight of last year for AES
through which the company added over 80,000
companies in Brazil as a whole – was people’s
families to its customer base in 2006, as a result
ability to develop themselves. The underlying
of a set of actions like the donation of standard
reason for professional and personnel development
cables and meter boxes, guidance as to the safe
programs was the awareness that each individual’s
and economical use of energy and the opening
behavior determines corporate success or failure
of reading rooms in needy communities. The
much more than machines and equipment.
regularization effort was much more than a loss
Consequently, the companies emphasize the
reduction program of an electricity distributor.
Leadership Development Program (to improve
It was actually a citizenship program, so much so
staff management and team motivation), the
that it gained USAID support for the Paraisópolis
BBS Program (which promotes safe behavior as
project, in Southern São Paulo city.
a way to prevent accidents), besides a continual
improvement in working conditions.
The commitment of the AES companies
The Companies also help society when they
manage costs better. In this sense, there are
management tools such as the AES Performance
in Brazil to sustainability was, therefore, a
Excellence quality program; work management,
requirement of the restructuring program. The
which increases productivity and improves safety for
advances observed over these three years are
employees; and asset management, which optimizes
further evidence that the introduction of practices
investments to obtain better technical and operating
and values geared to social and environmental
indicators. All these gains will contribute to a
responsibility – both concepts in their broadest
reduction in tariffs in the case of distributors.
sense here – are compatible with a strategy
designed to achieve consistent economic and
financial results. As a matter of fact, they are tactic
elements of this strategy.
It is, therefore, timely to include all three pillars
The introduction of these practices and concepts
of this concept in the 2006 Sustainability Report:
is not a one-time project, but a permanent process
economic and financial performance, social
that should pervade the routines of all AES
responsibility and environmental responsibility.
companies more and more until it becomes part
Consistently with corporate strategy, actions are
of corporate culture. According to the corporate
not described in isolation, but contextualized in
strategy outlined for 2007 and 2008, these routines
the Companies’ activities. Moreover, the results
will remain geared to society, the environment,
of these actions are not only mentioned, but also
technical and operating excellence, technological
shown in indicators (GRI - Global Reporting
development and the improvement of our services,
Initiative), which are used as parameters to assess
without losing the focus on cost control and
how much and in what direction we have advanced
revenue increase. If all these tools are used in a
and how far we still have to go.
coordinated manner, they will certainly enable us to
achieve consistent results for all our stakeholders.
1.1
Social and environmental
responsibility
are tactic elements of a strategy designed to achieve consistent
economic and financial results.
10
Corporate Governance
A relationship based on transparency with
This new format makes the Company a process-
shareholders, creditors, employees, suppliers,
oriented organization, and enables management to
customers and the community is a principle
make better decisions more swiftly.
cherished by the management and controlling
shareholders of AES Eletropaulo, who believe that
differentiated practices are essential to efficient
Code of Ethics
AES Eletropaulo’s relationship with its
and strategic business management. Therefore,
different stakeholders, as well as the principles that
AES Eletropaulo has been listed under Level 2
underline and guide the Company’s work model, is
of Bovespa’s Corporate Governance Standards,
based on its Code of Ethics and Business Conduct,
a segment of the list that includes companies
available on the Company’s Intranet.
that voluntarily commit themselves to adopting
4.6
4.9
superior governance standards.
ISE – Corporate
Reorganization
of business areas
AES Eletropaulo introduced a new
Sustainability Index
The use of distinct practices and our respect
for shareholders, creditors, employees, suppliers,
organizational structure in the second semester
customers and the community was once more
of 2006, with a view to better adjusting its
acknowledged in 2006. AES Eletropaulo’s
management model to the focus on long-term
shares remained on Bovespa’s Corporate
sustainable growth. All AES companies in Brazil
Sustainability Index (ISE) after a portfolio
were restructured and adopted a model that
review in December 2006.
provides greater autonomy and integration.
11
ISE is meant to be a model of socially
Moreover, Compliance and Internal Audit
responsible investment and good practices in the
areas have significantly contributed to the review
Brazilian business class, such as transparency,
of contracts with third parties. A special task
ethics, social participation and respect for the
force was headed by Internal Audit and a hired
environment. The new portfolio will be in effect
consultant to accurately assess AES Eletropaulo’s
until November 30, 2007, and it is made up of 43
deposits in court and compare them to the
stocks of 34 companies from 14 industries. Portfolio
provisions made so as to ensure data consistency.
components were chosen after a survey about the
This initiative was used as a tool for the
performance of publicly-held companies, according
development of new procedures to prevent errors
to criteria of economic efficiency, environmental
and unexpected accounting adjustment.
balance, social justice and corporate governance.
Board of Directors
Sarbanes-Oxley
The Company’s top governing body is the
AES Eletropaulo, as an important subsidiary
Board of Directors. Its duties include all strategic
of AES Corporation – an American publicly-held
planning and the development of solutions for
company with stock listed on the New York Stock
relevant problems.
Exchange – has had a Controls Environment system
The Board is currently made up of eleven
prepared to supply information required by Sarbanes-
effective members, four substitute members, two
Oxley Law to its parent company since 2004.
independent directors and a representative of
the employees. The Bylaws allow for a group of
4.12
up to eleven members, besides two independent
Administration of
members and a representative of the employees.
Legal Affairs
4.1
To improve control over the process of
procurement, budgeting and accounting activities
and to better report department results that are
lined-up to internal customers, the Legal Affairs
VP has taken over the task to administrate the
Company’s Legal Affairs.
1.
Brasiliana Building,
AES Eletropaulo’s
corporate headquarters
12
4.2
4.3
Statutory Audit Committee
A non-permanent Statutory Audit Committee
Investor Relations
The importance and commitment with
consisting of five effective members and two
transparency at AES Eletropaulo are the reason
alternates was established in April 2005 at
why the Company places a great emphasis on
the request of shareholders. The controlling
the constant improvement of its relationship
shareholder is represented by three members.
with securities market players. As a result, the
Preferred and minority shareholders can appoint
Company can disseminate accurate information
one member each group.
more quickly. To meet the demands of different
4.1
4.2
4.3
4.4
market segments, the members of the Investor
Relations area has organized and delivered
Board of Executive Officers
Operations are headed by the Board of
presentations and conference calls.
The results of FY 2005 and the quarterly results
Executive Officers, whose mission is to carry out
of 2006 were shown in four conference calls.
strategic decisions of the Board of Directors and
The Company has also participated in four events
to manage the business directly. It consists of
in Brazil and abroad that brought more exposure
the Chief Executive Officer, the Chief Operation
to the local and international investor community.
Officer and six Vice-Presidents/Officers.
In addition, Investor Relations professionals
4.1
also saw investors and analysts in 195 individual
meetings and answered questions from the investor
Audit and Ethics Committee
It is a permanent consulting and decision-
community in countless e-mails and phone calls
on a daily basis. To fulfill shareholders’ needs,
making body created in April 2005. It consists
the investor section on the AES Eletropaulo’s
of eight members from the Company’s Board of
website includes all the relevant information and
Executive Officers, with a joint two-year term. It
announcements, balance sheets, annual reports and
also has the managers of the Internal Audit and
other data interesting to this group.
corporate ethics and conduct/compliance areas,
who take turns as Committee Chair.
The duty of this body is to assist the Board of
One of the major achievements of the Investor
Relations area in 2006 was its contribution
to the success of the secondary offer of
Executive Officers by analyzing, discussing, offering
AES Eletropaulo shares. The amount of 15.8
guidance and suggestions. Its exists to ensure
billion Class B preferred shares (PNB) controlled
the introduction of Internal Audit plans and the
by AES Transgás Empreendimentos S.A. was
fulfillment of the corporate compliance program,
offered to the market on September 25, 2006.
including AES Eletropaulo’s Code of Ethics and
Conduct.
4.1
13
With the full exercise of the over-allotment
AES Eletropaulo enhanced its audit procedures
option (greenshoe), R$1.3 billion was raised and
in 2006 because of its commitment to transparency
used in its entirety to pay off Brasiliana Energia
of information. Internal Audit, along with the
S.A.’s debentures with BNDES in advance.
corporate accounting services of Deloitte Touche
The Investor Relations team organized and
Tohmatsu Auditores Independentes, successfully
participated in a roadshow with the leading
introduced independent audit procedures designed
coordinator of the offer that included 158 visits to
to assess the accuracy and reliability of financial
national and foreign investors. Of these investors,
information about business in Brazil. In addition
36 (67%) in Brazil, 48 (23%) in Europe, and 74
to the fact that audit is carried out on a quarterly
(62%) in the US accepted the offer.
basis, Internal Audit helped Deloitte perform AES’s
It was due to actions like these that
AES Eletropaulo was a runner-up in the Aberje
External Audit tests.
2.3
Investor Relations Award, with the case study
“The Challenge of Transparency in a Sector
Full of Peculiarities.”
Shareholding Structure
One of AES Eletropaulo’s controlling
shareholders is AES Corporation, an American
Audit
Ernst & Young Independent Auditors has
publicly-held company with stock listed on the New
York Stock Exchange and one of the largest power
been in charge of external AES Eletropaulo audit
suppliers worldwide with operations in 26 countries
since 2004, in compliance with the five-year
– holding a 50.01% stake in the Company’s voting
rotation requirement. Complementary services
capital through AES Elpa and Companhia Brasiliana
or consulting were not hired from that company
de Energia). The other controlling shareholder is
in 2006. Therefore, its services focused solely on
BNDES, the Brazilian Bank for Economic and Social
accounting audit so as to avoid any possibility of
Development (49.99% common shares.)
interest conflicts.
4.10
3.13
In 2006, the Company underwent corporate
restructuring, which is seen in greater detail in the
section Our Shares as an Investment.
14
Sector Environment
Economic
Situation in 2006
Electricity consumption is highly reliable on
In 2006, the Brazilian economy showed
several positive indicators, such as a low inflation
rate, high trade balance surplus, a better public
economic performance and varies with the level of
debt structure, with the elimination of the net
industrial activity, trading activity, employment
foreign currency public debt, and a sharp increase
rate and population income. Inflation rates,
in real wages and salaries, retail sales and credit.
interest rates and exchange rates also have
Moreover, expected financial indicators are also
an impact on corporate results since they are
very positive. Brazil risk and long-term interest
determining factors of tariff adjustments and the
rates fell to a record low.
payment of financial obligations.
2006
2005
13.19%
18.05%
2.14
2.34
Real appreciation over US dollar1
8.66%
11.82%
IPCA
3.14%
5.69%
3.85%
1.20%
Selic
1
FX rate (R$ x US$)1
2
IGP-M
2
1.
2.
End of year
Accumulated over the year
15
Basic interest rates have been falling steadily
The current sector model was designed to
since September 2005. Selic rate was 13.19% at
ensure power supply and reasonable tariffs. It is
the end of 2006 in comparison with 18.05% at
outlined in Law No 10.848 of March, 2004, which
the end of 2005. This drop was one of the main
regulates the operation of generation, distribution,
contributing factors to the sharp rise in domestic
transmission and marketing companies.
demand in 2006, which, according to the Brazilian
The concession contracts, entered into at
Institute of Geography and Statistics (IBGE),
the time of privatizations, entail that concession
followed the 3.7% rise in the GDP and rose by
holders reconcile their basic activities – in
4.3% in 2006.
the case of AES Eletropaulo, electric energy
According to data from the Monthly
distribution – with initiatives to further social
Employment Survey of IBGE, the unemployment
and economic development, such as the inclusion
rate in Brazil remained virtually flat throughout
of lower income people in their customer base.
the year and changed from 9.8% in 2005 to 10.0%
Additionally, concession holders are expected
in 2006. However, real average income increased
to contribute to environmental development
by 4.5%. There has been an upward trend of wages
since their basic raw material is a natural
and salaries since January 2005, which resulted in
resource. AES Eletropaulo has gone beyond legal
greater purchasing power for the population.
requirements in terms of both social responsibility
Accumulated IGP-M (General Market Price
Index) and IPCA (Broad Consumer Price Index)
and environmental preservation as can be seen
throughout this Report.
were 3.85% and 3.14% respectively in 2006.
Concerning exchange rates, the national currency
rate to the US dollar kept its upward trend and
rose by 8.66% in 2006.
Tariffs
An average adjustment of 11.45% was
authorized by Aneel for AES Eletropaulo tariffs
on July 4, 2006. Due to the drop in subsidies,
The Electricity Sector and its
high tension consumers (large commercial and
Regulatory Environment
industrial consumers) had higher percentage
The Ministry of Mines and Energy (MME)
sets the guidelines for the Brazilian electricity
sector, which is regulated by Aneel, the Brazilian
Agency of Electric Energy. Besides these bodies,
the following institutional agents also play a key
role: The Electric System National Operator (ONS),
which coordinates and controls the operation of the
Interconnected System; the Chamber of Commerce
for Electric Energy (CCEE), which is responsible
for the accounting and liquidation of short-term
market transactions and, under assignment of
Aneel, holds electricity auctions; and the Energy
Research Enterprise (EPE), which conducts studies
and surveys for sector planning.
16
adjustments than low tension consumers.
See table:
Consumer Class
Index
Low Tension
-1.91%
High Tension
8.26%
A2 (88 to 138 kV)
4.57%
A3a (34.5 kV)
6.20%
A4 (2.3 to 25 kV)
9.08%
Energy supply tariffs are adjusted annually
according to a parametric formula described in
No Fines
AES Eletropaulo’s Regulatory Affairs area
concession contracts. It includes pass-through
has been striving to set rules for its internal
of non-manageable costs (sector charges, cost
processes and find room for improvement as
of purchased electric energy for resale and
far as regulatory milestones are concerned.
transmission costs) and the adjustment of the
This initiative shows the Company’s pioneering
company’s manageable costs by IGP-M in the last
attitude in creating an in-company Regulatory
twelve months (operating expenses, remuneration
Certification. Besides, AES Eletropaulo has
of assets and depreciation). Factor-X is deducted
adopted risk management procedures based
from manageable costs so that the consumer will
on Basel’s COSO method and assessed by a
get energy distributors’ scale gains.
Regulatory Risk Management Committee of AES
A supplemental R$98 million was added to
2006’s adjustment corresponding to the second
companies in Brazil.
AES Eletropaulo has not gotten any fine for
portion of the recovery of additional PIS and
the third year in a row in 2006. The Company
Cofins expenses from 2002 to 2005, as a result of
negotiated the settlement of 229 lawsuits
changes in the rates and bases of these taxes.
resulting in legal fines and penalties between 1998
AES Eletropaulo’s tariff is reviewed every four
and 2003, and was able to save R$89 million.
years to reestablish power distribution concession
Much of this result was due to the Company’s
holders’ economical and financial balance in their
greater proactivity towards regulatory bodies, in
concession areas.
keeping with its policy of a close and transparent
In 2007, AES Eletropaulo will be one of the
first Brazilian companies to go through a second
relationship with all its stakeholders.
As the largest electricity distributor in the
Tariff Review and it has been preparing for the
country, the Company constantly reinforces its
event since May 2006. The Company has been
presence in and contribution to the discussions
revising and reinforcing the points that will be
about sector-related issues. In 2006, it had active
considered by Aneel, such as the assessment
representatives in 19 organizations and trade
methodologies for its asset base, for which it
associations, which have over 200 professionals.
will be compensated, and the operating costs
EN28
4.13
S08
PR9
1.2
and expenses of the reference company, to be
established by the regulatory agency.
17
OPERATING ACTIVITIES
AES Eletropaulo’s business – electricity
Commercial Activity
distribution – is a public interest service and,
therefore, a social responsibility in itself.
The Company is aware of that and tries to segment
Market
Total energy consumption (captive and free
its services since its concession area includes a
consumers) in AES Eletropaulo’s concession
number of different activities related to industry,
area rose by 4.6% in 2006 as a result of the
trading and services.
economic recovery and the increase in the income
Because of this diversity and the fact that
this is the most populated area in the country,
AES Eletropaulo is always concerned about
and, consequently, the purchasing power of the
population.
This variation is greater that the national
anticipating the needs of each of its consumer
average, which increased by 3.8% according to
groups.
EPE. This result was possible because São Paulo
2.7
State, which has most of the economic activity,
GDP and population in Brazil, responded more
quickly to the economic recovery situation in the
country throughout the year.
18
Sales segmentation
AES Eletropaulo had more that 5.5 million
registered customers by the end of 2006. This
Residential Customers – with 5.0 million
number includes the net growth of 171,000 new
registered customers at the end of 2006 (92.23%
clients, who joined the Company’s customer base
of the Company’s total), electricity consumption
mainly because of the social inclusion strategy,
rose by 6.9% in this class. This performance was
which has been regularizing illegal electricity
positively influenced by the addition of 192,000 new
connections in low income communities.
customers, including those who came as a result of
Another contributing factor to this rise was
the effort to regularize electricity connections. The
the change in the economic profile of some places
gradual recovery of the economy, which resulted in
in the State capital, such as previously industrial
an increase in wages and salaries and in the domestic
areas that were revived and became commercial
demand, was also responsible for the rise in the
areas. The Company supplied 31,656.1 GWh to
consumption of this consumer class.
the captive market in 2006 (excluding its own
Commercial Customers – consumption
consumption), an amount equivalent to that of the
increased by 3.2% in comparison with 2005 in spite
previous year (31,634.1 GWh). This performance
of the migration of 13 consumers to the free market
positively reflects the growth in residential and
over the year. This result, in particular, reflects the
commercial consumption, which, however, was
sharp increase in real wages and salaries, credit and,
mitigated by the migration of 46 consumers to
consequently, retail sales.
free market and the success of power consumption
Industrial Customers – had a 12.9% drop in
efficiency and rationalization programs.
2006, mainly due to the migration of 33 captive
consumers to the free market.
Consumption Comparison in GWh
(excluding own consumption)
4.6%
2005
34.2%
36,499
38,183
Total
Market
Captive
Market
4,865
6,527
2,598
2,465
Public Sector
and Others
9,593
9,898
Commercial
7,580
6,606
-5.1%
Free Consumers
-12.9% 3.2%
Industrial
Residential
11,863
12,687
6.9%
31,634
31,656
0.1%
2006
19
Other Clients – includes rural consumers,
Free Consumers – although they are not in
public lighting, public authorities and electric
the regular customer base, free consumers also
traction. Consumption of this class fell by 5.1% in
contribute to sales through the payment of the
2006. This was mainly due to the replacement of
Tariff for the Use of the Distribution System
old light bulbs for new ones, which use less electric
(Tusd), responsible for the recovery of sector
power, in public lighting, an action of Reluz energy
charges, the distributor’s operating costs, taxes
efficiency program.
on revenues and own and third party capital
remuneration. Revenues rose by 38.7% with Tusd
in 2006, a consequence of the 34.2% rise in the
consumption of free customers, totaling 185 at
the end of 2006 in comparison with 139 in the
Energy Consumption by Class – GWh
previous year.
Residential
The retention rate of AES Eletropaulo’s potentially
Commercial
free consumers is 83%, the highest rate among
Industrial
all the large electricity distributors in the
Free
country. The Company renewed 21 contracts
Others
with potentially free consumers during the year
and pursued its loyalty plan, based on activities
like workshops, courses, the introduction of
2005
a newsletter, the sale of interruptible power,
7.1%
13.3%
the negotiation of accounts with ICMS credits,
32.5%
energy efficiency projects and benefit plans (Load
Management and Preventive Maintenance).
2.7
20.8%
26.3%
Energy Supply
The power that AES Eletropaulo distributed to its
customers in 2006 came from the following sources:
36.4% or 13,914 GWh from auctions held by
2006
the Chamber of Commerce for Electric Energy
6.5%
17.1%
(CCEE), whose average tariff was R$63.87;
33.2%
32.2% or 12,293 GWh from Itaipu. Electricity
from this source must be purchased in dollars,
in an amount determined by Aneel, whose
17.3%
average tariff was R$87.83;
25.9%
20
Energy Summary 2006
Supply (GWh)
Billing (GWh)
Itaipu
12,317
Residential 12,687
Bilat. Tietê
11,108
Commercial 9,898
Industrial 6,606
Energy Required
Bilat. Uruguaiana
517
Bilat. Others 259
Proinfa
146
Own Consumption 33
13,914
Transmission Loss 900
Distribution Loss 5,211
Auction CCEE
37,801
-460
Public sector and Others 2,465
Obs.: The Itaipu Contract in the above chart differs from that in the balance sheet because the energy accounting
amounts do not show Basic Grid losses recorded by the CCEE.
29.1% or 11,108 GWh from the bilateral
As of March 15, 2004, with the advent of the
electricity purchase contract with AES Tietê,
New Electricity Sector Model, distributors were
whose average tariff was R$133.29.
able to purchase power only at CCEE-regulated
This generator began to supply all its
auctions to meet the rising demand. Nevertheless,
assured energy to AES Eletropaulo in 2006;
the bilateral contracts previously entered into will
2.0% or 776 GWh from other bilateral contracts
remain in force to full maturity.
entered into with co-generators of energy
AES Eletropaulo participated in two new
(biomass) and AES Uruguaiana, with maturity
energy auctions and purchased 576,306 GWh
dates between 2009 and 2013 and at an average
of electricity, which will start to be supplied in
tariff of R$116.66;
2009 and 2011 (15 and 30 year-contracts.) The
0.4% or 146 GWh through Proinfa (Incentive
Company did not participate in the fifth existing
Program for Alternative Sources of Electric
energy auction, which offered contracts with initial
Energy), whose power purchase volume
supply in 2007, because it had already purchased
is established by Aneel, according to the
100% of all the energy required for this year.
distributor’s share of the captive consumer
market, at an average tariff of R$284.70.
21
The volume of energy purchased is calculated
As a result, all regulated quality indicators
according to consumption forecasts for the
met their targets in 2006. DEC (Equivalent
next five years. Consequently, AES Eletropaulo
Duration of Interruption per Consuming Unit)
introduced a statistical model for risk analysis
and FEC (Equivalent Frequency of Interruption
and optimization, which determines the proper
per Consuming Unit) indices of 7.87 hours and
amount that should be purchased. The supply
5.52 times, respectively, were the lowest the
strategy is based on purchase levels between 100%
Company has ever achieved. The consolidation of
and 103% of the forecast demand in order to avoid
the automation of grids and operating centers was
penalties, as required under the New Electricity
crucial for this good performance.
Sector Model. According to the new rules for
In order to maintain service quality levels and
the sector, electricity distributors are allowed to
to tackle the problem of power failures caused by
reduce purchases made at existing energy auctions
summer showers, the Company runs a Summer
as customers migrate to the free market.
Operation every year, a task force to respond to
emergencies during this season. A pioneer in this
Quality Indicators
sort of planning for peak hours, AES Eletropaulo
As it holds the concession for electricity
has a motorcycle fleet that travels ahead of
distribution in the São Paulo metropolitan region,
operating teams to ensure prompt service and to
AES Eletropaulo seeks to offer the quality levels
take the first measures in emergency cases. More
expected by its customers and to contribute to
equipment resources, such as transformers, cables
social development and general well-being besides
and other materials needed for quick emergency
providing an essential utility to the population.
repairs and backup for operating teams and call
centers are provided.
7.87
5.52
11.81
8.61
2006
12.38
8.66
9.08
6.83
12.79
8.68
2005
12.57
8.95
8.94
6.41
11.09
8.68
13.62
9.42
2002 with
blackout
effect
8.99
7.51
2001
2000
1999
1998
22
9.92
2004
10.22
8.21
6.91
10.26
14.77
2003
10.29
11.44
9.2
15.4
19.43
10.90
15.75
18.21
10.19
16.01
DEC (hours)
FEC (times)
DEC Aneel Standard
FEC Aneel Standard
Capital Expenditures
AES Eletropaulo invested R$377.7 million in
Main investments made in 2006:
2006, including R$58.4 million in self-financed
Three new substation were inaugurated (ETD
projects (customer expenditure.) The ultimate
Taipas, ETD Raposo and ETD Represinha),
goal of these investments is operational excellence
which added 160 MW to system capacity and
so as to increase system reliability and capacity,
whose conclusion cost R$3.8 million.
improve quality levels and operating efficiency,
minimize losses and offer a better service to
consumers of all classes.
Investments
2006
%
137.9
36.5
Maintenance
54.1
14.3
Loss Recovery
42.9
11.4
Information Technology
54.6
14.5
Others
29.7
7.9
319.3
84.5
58.4
15.5
377.7
100.0
Customer Service and System Expansion
Total (Own Resources)
Self-Financed
Total Investment
23
Five other substations were enlarged and
Customer Relations
renovated and, as part of these enlargements,
In keeping with the principle of always
12 new primary feeders were built, which cost
remaining close to its customers and aware of
R$10.8 million. Another R$1.3 million was
their needs, AES Eletropaulo maintains several
allotted to the reconstruction of Paula Souza
programs and a series of activities designed to
Underground Subtransmission Line in Brás
offer greater comfort and convenience for its
(São Paulo city.)
consumers.
Electric connections were regularized, as part
of a social-economic program. Concerning loss
The following loyalty actions geared to the
corporate segment were carried out:
recovery , new technologies for equipment and
Seven technical-commercial workshops
meter readings were introduced, making it
Ten courses in “Final Uses of Energy”
more difficult to make illegal connections.
Five issues of a bimonthly newsletter
The initiative consumed R$42.9 million.
Sale of interruptible energy (180 GWh in 720
contracts in 2006)
In Information Technology, investments
Over 100 energy efficiency projects
in the initial phase of Genesis Project totaled
Development of simulator software for contracts
R$54.6 in 2006. This project, which consists of the
to help customers optimize energy purchase.
expansion and upgrade of the management system
PR5
for administrative processes and client service,
will result in greater process standardization and
quicker and more reliable information retrieval
through SAP solution.
The plan projects a drop in the amounts invested
in subsequent years (R$38.0 million in 2007 and
R$18.5 million in 2008.)
1. The Regularization
Program includes public
lighting projects in the
regularized sites
2. The Company organizes
seminars on the hiring
of energy to corporate
customers
3. Consumers can request
services in the self-service
facilities
2.
24
1.
3.
Mais Eletropaulo
Comunidades
are service centers installed in underprivileged communities that offer additional
facilities, other than commercial services, such as libraries and free Internet access.
These initiatives were a contributing factor to
A call center equipped with cutting-edge
AES Eletropaulo’s achieving the highest retention
systems, such as “best time” — which allows
rate (83%) in the captive segment of all large
customers to schedule a call from the Company
Brazilian distributors in 2006.
and avoid long waits — and a “prefix system
The Company also has a large service network
– automated emergency service”, which records
for low tension customers. We constantly seek to
information about incidents in the area where
incorporate innovations and further conveniences
the call came from. The call center took in 9.2
to meet the needs and expectations of our
million calls in 2006.
customers and go beyond mere customer service.
An ombudsman’s office, which acts proactively
Low tension customer relations involve:
to serve customers. This resulted in a drop in the
15 strategically located service offices with a
number of complaints, from 30,000 in 2005 to
showroom, pre-service, self-service facilities and
slightly over 19,000 in 2006.
personal customer services.
Additional convenience services for residential
25 Mais Eletropaulo (More Eletropaulo)
customers, such as Conte Comigo 24 horas
service centers, eight of which opened in 2006.
(Count on Me 24 Hours: electrician, plumber
These centers handle all service requests, debt
or locksmith services among others) and
negotiations and bill payments.
Seguro Super Proteção Premiada (Insurance
Two Mais Eletropaulo Comunidades (More
Awarded Super Protection). Conte Comigo 24
Eletropaulo Communities), service centers in
horas received the 36th Marketing Top Award of
underprivileged communities with additional
Associação de Dirigentes de Marketing e Vendas
facilities, such as libraries and free Internet access.
do Brasil (ADVB, or Brazilian Association of
Internet-based services, including an online
Marketing and Sales Leaders) with the case
chatroom. The website offers 32 online services,
study Survey-Based Product Innovation in 2006.
and is prepared for access of sight-impaired
PR5
4.15
ec8
individuals.
25
Loss Reduction
This regularization effort is conducted jointly
and Collection
with city governments and district administrations,
AES Eletropaulo’s Total Loss index fell by 0.9
which have joined forces to urbanize underprivileged
percentage points in 2006, with a 14.3% drop in
communities. More than 80,000 illegal connections
commercial (non-technical) losses in comparison
were regularized and 320,000 people were benefited
with 2005. This performance resulted in a 12.0%
in 2006. One of the projects introduced last year
Total Loss and collections over R$101 million in
was that of Paraisópolis community, in which
recovered energy in 2006.
USAID and ICA (International Copper Association)
participated as partners.
Regularization of
electric connections
The interaction with the community is one
promoting citizenship among low income people.
A regular service gives customers proof of residence
of the main characteristics of AES Eletropaulo’s
– the bill. As a result, they can get other benefits,
operations. Besides seeking excellence in
such as documents, bank accounts and credit.
providing an essential utility, the Company
Service offices were opened for registered
believes that its activities must include initiatives
customers in large communities like Heliópolis
that promote social well-being so that it can fulfill
and Cidade Tiradentes. They are called Postos
its duty.
Mais Eletropaulo Comunidades (More Eletropaulo
This belief is the basis of AES Eletropaulo’s
Community Service Centers) and offer facilities like a
Program for the Regularization of Electricity
library and free Internet access. These initiatives are
Connections in low income communities, a
designed to promote integration with the community
R$42.9 million investment. This program has
and its leaderships. The Company also carries out
been in effect since June 2005 and was one
actions and develops promotional material (such as
of the Company’s priorities in 2006.
pamphlets, poster and newsletters) to inform the
An innovative project, it combines the
regularization of power supply with social
responsibility and leads to a drop in non-technical
losses for the Company. It includes the repair of
internal home wiring and a campaign to offer
guidance concerning the safe and rational use of
electricity. This campaign consists of lectures and
site visits. It also involves a drop in the consumption
of a portion of the people who received the benefit
because the Company donates energy-efficient
refrigerators and light bulbs. Two thousand
household appliances were donated in 2006.
26
Regularizing an illegal electric connection is also
population about the program.
EN5
EN6
4.17
Default prevention and reduction
Collection
Other actions were carried out throughout the
PCLD (credit provision for doubtful accounts)
year, such as default prevention and reduction
expenses fell from 1.6% of gross revenues in
(past-due notices, phone calls informing clients
2005 to 0.7% in 2006. There were about
of electricity debts, power shutoffs for lack of
1.4 million power shutoffs during the year
payment, inspections for reconnections by clients
compared to 1.0 million in 2005, which required a
etc.). Over 450,000 inspections were made,
R$27 million investment in 2006 (46% more than
more than 50,000 violations were registered and
in the previous year.) In addition, R$64.1 million
32,000 incorrect meter readings were found.
was collected by an outsourced collection service.
These actions contributed to the 99.1% collection
From this amount, R$18.3 million corresponded
rate achieved by the Company, and a collection
to accounting losses. Another R$6.0 million
totaling R$13.2 million more than in 2005.
was recovered through notes of protest.
Another achievement of the Company was
a record level of settlement of the public sector
obligations, which was 104%, due to agreements
with several state and city government bodies
– especially those of São Paulo city – concerning
overdue payments. Therefore, the Company’s
stock of public sector debt fell by R$327 million
over the year.
98.48%
98.46%
97.45%
99.03%
99.14%
2002
2003
2004
2005
2006
86.19%
97.22%
2000
2001*
96.57%
1999
Collection Rate
* Rationing
27
Rebilling
AES Eletropaulo achieved a historical
AES Eletropaulo reviewed its billing process
milestone with the help of its highly-skilled
in 2006, as part of its effort to improve its work
employees in 2006: the Company managed 39
methods. There was a 44.7% drop in the rebilling
projects geared to technical and commercial
rate (IRC – Abradee) due to the introduction
operations (17 of which it developed), with
of the new reading system (Sigem and Repasse
investments totaling R$15.1 million. These
Noturno). Currently, only four out of every one
technological projects, which involved 72
thousand bills are reissued.
researchers and 23 coordinators, were geared to
a range of business-related areas, from technical
Research and Development
AES Eletropaulo is always striving to improve
aspects of electricity distribution (like distribution
and transmission grids, equipment and meter
its processes, customer service, working and
reading technology) to solutions and research for
safety conditions as well as to reduce costs.
safety, the environment, information systems,
Consequently, Research and Development
customer service and, above all, the regularization
(R&D) are key factors in the development of our
of electric connections.
services. The development of new technologies
means much more than fulfilling a regulatory
Development (R&D) Workshop was also held in
requirement for AES Eletropaulo. It is the road to
order to contribute to the dissemination of specific
operating excellence and the means to better meet
sector knowledge. Thirty-four organizations and
customers’ needs. Additionally, the use of modern
research centers attended the event, where they
technologies enables us to minimize safety risks,
made presentations about their highlights and
contributes to energy efficiency and mitigates any
their resources (laboratories, researchers and
possible negative impacts on the environment.
instructors) for research of the Company’s interest.
1.
28
The 2006/2007 Cycle of the Research and
2.
3.
1. AES Eletropaulo’s
employee disseminates the
Program for Regularization
of Illegal Electric
Connections in low-income
communities
2. Integrated Solutions
Projects reduce corporate
clients’ costs with
consumption of energy,
water and gas
3. Energy Efficiency
modernizes customers’
installations and contributes
to the preservation of
natural resources
A R$ 23.5 million investment is expected for this
cycle. This amount corresponds to 0.3% of the net
Compact grids
200 km of compact overhead power lines were
operating revenues of AES Eletropaulo, pursuant to
installed in 2006. This technology provides lower
the electricity sector legislation. From this amount,
shutoff risks, causes less visual and environmental
R$10 million will be invested in new projects.
impact and lasts longer than traditional grids. As
AES Eletropaulo has furthered R&D since
a result, it is used in areas with trees or a large
1998. It has run 87 projects since the launch of the
number of construction sites, places where there
program, 80% of which have been adopted or are
is a higher probability of accidents that may affect
in their preparation stages to improve Company
the power supply. AES Eletropaulo has gradually
procedures.
been replacing compact grids for traditional grids.
They have been used in new projects since 2005.
Subtransmission Maintenance
PR1
AES Eletropaulo systematically replaces and
upgrades substation equipment as part of its
maintenance plan to ensure a reliable energy supply.
Energy Efficiency
Electricity distribution concession holders
In 2006, R$1.19 million was invested in this plan,
must invest a minimum of 0.5% of their net
which involved replacing 48 high-voltage lightning
operating revenues in actions to prevent electric
arresters, three medium-voltage lighting arresters
power waste pursuant to their concession
and 52 high-voltage loadbreak switches.
contracts.
Nevertheless, AES Eletropaulo believes that
New Technologies
fighting electric power waste means more than
just complying with a regulatory requirement
Grid automation
The Company is running an automation project
and, so, its activity in this regard has gone far
beyond that. The Company sees the rational
for high tension (88 kV/138 kV) and medium
use of electric power as a contributing factor to
tension (13.8 kV/20 kV/34.5 kV) grids with a
social-economic development, good public health
view to increasing operating safety and flexibility,
and the preservation of the environment and
besides improving the reliability of continuous
natural resources. It is, therefore, a component
energy supply. The Company has installed 16
of its social-environmental commitment to future
telecommand stations in its high tension lines and
generations.
42 stations in the medium tension distribution
grid in 2006. In addition, to ensure safety for
teams working on grid maintenance, telecommand
stations are installed upon customer request and
at customer’s expenses to insulate consuming
units with large generators.
PR1
29
Its energy efficiency program required
investments totaling R$31.6 million in different
Reluz Program
Reluz Program for Efficient Public lighting was
projects for both private and public customers in
launched in 2000 and aims to increase energy
2006. R$4.2 million was invested for 36 public
efficiency in public lighting and, consequently,
sector customers, as seen in the table below.
reduce city expenditures on this important service.
The Energy Efficiency program focuses on
The national public lighting network consists of
the use of more efficient technologies with less
13 million lighting points. Seven and a half million
impact on the environment. It is also designed
of them can be made more efficient.
to promote social inclusion by means of intense
The program is managed by the Ministry of
activity in low income areas. The practical effects
Mines and Energy and carried out by electricity
of these beliefs can be seen in the donations of
concession holders – distributors, transmission
standard cables and meter boxes, as well as in the
companies and generators – jointly with city
courses and orientation sessions offered to the low
governments. Eletrobrás finances up to 75% of the
income population and in the use of more energy-
project. The rest is the concession holders’ and
efficient light bulbs. The idea of energy efficiency
municipalities’ tradeoff, which can be services,
is reinforced in advertising campaigns and in the
transportation or labor. AES Eletropaulo allotted
Eletropaulo na Comunidade Program, introduced
R$25 million to this program in 2006. It replaced
in public schools.
46,000 mercury vapor bulbs in its concession area
EN5
PR1
for sodium vapor bulbs, which are more efficient.
This resulted in a 21.5 GWh drop in consumption
per year.
EN5
EN6
Energy Efficiency Program
Public Sector Investments
No. of clients
R$ mil
22
1,689.1
Amount Invested in Govt Departments
7
429.8
Amount Invested in Hospitals
7
2,087.2
36
4,206.2
Amount Invested in Public Facilities
Total invested in 2006
30
Health and Safety
AES Eletropaulo’s first value and basic premise
The program involves developing leaderships,
is to ensure the safety of its employees, contractors
training employees to pay constant attention to
and members of the communities it serves. When
their peers’ activities and encouraging analyses of
used incorrectly, electricity can cause serious
and discussions about work routines. This is done
problems for people’s health and life, as well as to
with a view to finding and promoting positive
the environment.
behaviors to strengthen the safety culture among
AES Eletropaulo aims to operate without any
all employees. This method makes it possible to
accidents both for its own employees and for those
recognize good work, collect information about
of contractors. Consequently, it has been adapting
risks that can be eliminated and, therefore, to
its facilities, developing procedure guides and
prevent accidents.
streamlining its operating routines since 2002.
In October 2006, it introduced the BBS
AES Eletropaulo’s BBS program was considered
a reference for AES’s Latin American operations.
(Behavior Based on Safety) Program, intended to
As a result, the Company was visited by observers
change behaviors concerning safety and improve
from other group companies throughout the year.
service quality and internal processes.
The program had 78 trained observers and involved
2,000 employees in late 2006.
31
Among other related actions, the safety
Company staff members are often interviewed
assessment laboratory was renovated and tracking
by mass media like radio, newspapers and TV
chips for protection equipment were adopted.
about accident prevention. The awareness-raising
Besides, 130 activities were revised in Work
effort includes advertising campaigns run in
Procedures Manuals. AES Eletropaulo won the
newspapers, billboards and posters on buses, bus
2006 Workplace Safety and Health Management
terminals and the Metro system, aimed at always
Funcoge Award, from COGE Foundation, for
warning the population of electricity-related risks.
its results in the management of outsourced
All AES Eletropaulo’s safety and health actions
companies.
are in keeping with the Management System
2.10
and meet the requirements of OHSAS 18001,
which is fully effective. This system emphasizes
Information is one of the most important tools
the prevention of injuries and illness, as well as
to prevent accidents. AES Eletropaulo is aware of
ongoing monitoring to ensure that all activities are
the risks of its activities, so it is firmly committed
performed in a safe and healthy manner.
to disseminating information and guiding the
The Company recorded a 4.12% frequency
population about the correct use of electric power.
rate and a 1,715 seriousness rate according to the
In this regard, AES Eletropaulo trained 40 out of
NBR criterion (Brazilian Legislation). The average
80 lecturers who travel around the 24 cities and
frequency and seriousness rates in the sector for
towns in which the Company operates to hold
companies with over 2,000 employees were 5.64
lectures and courses. In addition, the Company
and 632 respectively (Funcoge Data for NBR
runs awareness-raising campaigns in schools,
Indicator).
community associations etc. The safety message
is also taken to the low income population in
areas where the Program for the Regularization
of Illegal Electric Connections is present, through
lectures and pamphlets. Cars with PA systems
travel around areas outside São Paulo city to
reinforce this message.
32
1. Health and safety actions
aim at the prevention of
occupational injuries and illness
2. Labor exercises are practiced
in all of the Company’s areas on
a daily basis
3. BBS (Behavior Based Safety)
stimulates safe behavior at the
work place.
1.
2.
3.
Safety
is AES Eletropaulo’s first value and basic premise that uses the
dissemination of information and guidance as important tools
to prevent accidents
The high seriousness rate is due to the April
2006 helicopter accident, which claimed the lives of
two AES Eletropaulo employees and the pilot of the
air taxi company during a routine flight for power
line inspection (*). Pursuant to Brazilian legislation,
6,000 days are charged for each death, i.e., 12,000
( )
* AES Eletropaulo is expecting the Anac (Agência
Nacional de Aviação Civil, or National Civil Aviation
Agency) report about the causes of the accident, and
it believes all precautions required by power line
inspection flights were taken, such as: a trustworthy air
taxi company was chosen, all the documentation of the
helicopter and of the pilot was checked upon hiring and
all safety provisions in the contract were complied with.
LA8
LA7
LA11
days were charged in these statistics and resulted in
a dramatic rise in the Company’s seriousness rate.
This rate would have been below 160, or 74% below
sector average, if this accident had not happened.
Frequency rate* and Seriousness rate**
Frequency rate
1.715
2006
3.03%
44
2005
2.80%
2004
217
5.65%
801
2003
2002
228
9.34%
4.12%
Seriousness rate
* Frequency rate =
nº de acidentes x 1,000,000
hours/employee worked
** Seriousness rate =
(Lost days + Charged days) x 1,000,000
hours/employee worked
33
Business Management
AES Eletropaulo believes that good results
Management Tools
can only be achieved through the continuity of
its actions. Consequently, it is managed so as
Apex
to ensure the sustainability of its business by
AES Performance Excellence
means of activities that maintain its economic,
A program involving efforts from all corporate
financial, social and environmental consistency.
levels to systematically allocate resources and
In addition, the Company has sought to value and
take all the opportunities to increase revenues
motivate its employees by placing great emphasis
with a view to improving business processes on
on training, besides developing new methods and
an ongoing basis. It is adopted by AES group
technologies to contribute to sustainability in its
companies worldwide.
broadest sense. It also encourages Participative
At AES Eletropaulo, 325 people participated
Management, so it accepts employees’ suggestions
in a training course focused on the methodologies
for improving internal processes.
and tools of the program. Participants developed
48 projects in different areas (operations,
trading processes, losses, customer satisfaction,
law strategies, human resources etc.). At least
197 of these people are directly involved in the
Company’s operating areas.
34
APEX was introduced in April 2006. It had
Also noteworthy are the use of this method
already produced positive results and gained
in the Commercial and Project areas, the
recognition a few months later. Productivity and
centralization of emergency and loss prevention
financial gains were recorded and resulted in a
services and the creation of a construction team.
cost reduction of a about R$4.2 million in 2006.
LA8
“Reducing Recovery Time For Service
Interruptions” was elected the second best APEX
Asset Management
project at the “APEX Celebration Meeting,” in
Also introduced in 2005, it is designed to
December 2006. Cancun, Mexico, where AES
optimize resources by allocating them according
companies from the whole world presented their
to priorities and thus contribute to asset
cases studies.
maintenance. Consequently, the Company is
seeking greater efficiency and better indicators,
Work Management
A program that was introduced in 2005 and
in terms of both quality and sales.
These actions enabled AES Eletropaulo to
seeks to better organize the activities of clerical
achieve its goals for regulated quality indicators
and field personnel by improving processes,
in 2006, as seen in greater detail under “Quality”
increasing synergy and adopting best practices.
in the Operating Activities section.
This will result in more effective operating
control and improved safety conditions for AES
Eletropaulo’s employees.
Work Management practices in operating
Information Technology (IT)
The technological upgrade of the SAP/R3
Business Management System platform was the
lines resulted in a 17% rise in productivity and
highlight of the system for the management of
a financial gain of over R$10 million in 2006.
administrative processes and AES Eletropaulo
A contributing factor to this result was the
customer service in 2006. This upgrade
installation of a GPS tracking system in 777
was crucial for the adoption of the new CCS
vehicles. This allows a more efficient and quicker
Commercial Management System, and it involved
customer service.
the stages of development, configuration and
integrated testing.
35
The SAP management system had a series
These actions are a part of Genesis, an
of important upgrades in 2006 and achieved a
AES Corporation global project, whose process
99.98% availability rate. This improvement made
design and configurations were made at
it possible to review the business processes in the
AES Eletropaulo, with the expertise of
financial and supply areas and to improve systems
professionals from Brazil and seven other
and productivity controls. Moreover, the Company
countries where AES Corp operates.
implemented the new AES global processing
AES Eletropaulo pioneered the implementation
platform for the SAP system. It used two latest
of the project, which will later integrate
generation international data processing centers,
AES Corp businesses in all 26 countries where it
in Virginia, USA, and London, UK. This new
operates and will allow greater synergy among
platform allows better processing performance
the companies. Over 3,000 Company employees,
and enhances logical data security.
along with 600 partners, will be trained for the
A new process-based IT governance model
changes in processes and systems.
was introduced as a result of the adoption of new
management practices. This led to a 4% drop
the telecommunications structure to ensure direct
in service costs. Technological challenges such
communication between AES Eletropaulo and
as the installation of a 1Gbps data link between
its parent company in the US. In streamlining its
Brazil and the US were overcome. This link is ten
processes, the group will gain the ability to assess
times as fast as a regular local computer network
its subsidiaries more accurately, and they, in turn,
in a business building. Great effort was needed
will be able to better comply with the established
to install this link because it required changing
guidelines and respect each country’s peculiarities
the access profile of most of the 800 system
at the same time. Processes will be better and
users in keeping with the new corporate rules for
faster, and information retrieval will be easier and
the segregation of duties. Associated risks were
more reliable with the new system, which will start
mitigated with the introduction of a training and
operating in 2007. In addition, billing management
communication plan.
and customer services will be more efficient.
1.
36
Genesis Project also involves the upgrade of all
2.
3.
1. Technicians repair the
electric energy meter boxes
2. Employees share ideas
and suggestions during
breakfast with the CEO
3. Individual and Collective
Protection Equipment are
subject to regular testing
so as to ensure safety of the
employees
Ethos-Abradee
Relationship with
indicators
Internal Stakeholders
The use of Ethos-Abradee indicators results in
the Company’s considering Values, Transparency
and Governance, Internal Stakeholders,
LA1
LA2
LA3
LA5
LA8
LA10 LA11
LA14
Environment, Suppliers, Consumers and
Customers, Community and Government and
Sustainable management is based on the
Society relevant aspects in management. These
adoption of the concept of best practices and its
issues are closely related to management geared to
development by a company’s human resources.
social responsibility practices, strategic planning
With this in mind, AES Eletropaulo values its
and overall performance. Indicators will be
4,316 professionals (late 2006 figure), develops
announced to the areas directly involved so that
leaderships and invests in capacity-building.
improvement goals can be set.
Satisfaction Survey
Turnover
and the Brazilian Association of Electric Energy
5.21%
by the Brazilian Electric Energy Agency (Aneel)
4.97%
Satisfaction surveys are currently conducted
Distributors (Abradee) to assess service quality,
tariffs, trust, corporate image and satisfaction
among others. These surveys help the Company
2006
2005
strategically plan the activities of different areas.
2006
Number of Employees Own
2005
Own
Outsourced
Own
Outsourced
Communication
17
1
17
1
Corporate coordination
26
14
26
8
Legal affairs and institutional relations
48
30
47
40
Human Resources
96
14
101
10
3
4
3
2
173
78
179
39
64
41
63
47
3,087
2,713
3,133
2,743
Corporate services
178
576
177
381
Technical area
617
1,222
628
1,165
7
2
4,316
4,695
4,374
4,436
Chief Officers
Commercial
Financial
Operations
Total
37
The well-being and self-fulfillment of our
Employees by Area (%)
Operating Area
employees, one of the Company’s values, guides
Administrative Area
the human resources policy, whose main points
Technical Area
are as follows:
Relationship policy
2005
AES Eletropaulo has formal policies and
14.0%
mechanisms to listen to, assess and follow up on
attitudes, concerns, suggestions and criticisms,
always with a view to acquiring knowledge,
49.0%
37.0%
besides fighting sexual or moral harassment.
It follows, in addition, a strict policy of respecting
the privacy of its employees regarding delicate
information (including medical information)
obtained and kept secret by Human Resources.
2006
Additionally, the Company always posts
12.9%
information that may affect its personnel in time for
both the union and the employees to take a stand.
AES Eletropaulo has also sought to develop
motivational programs, which are components
37.2%
49.9%
of its employee recognition plans. In 2006,
events such as Electricians’ Day, Knowledge
Disseminators’ Day, Attendants’ Day, Breakfast
with the President, Local and National Power
Rodeos (AES Eletropaulo was the first runner-up
in the national contest) and the Year End Party.
The well-being
and the self-fulfillment of AES Eletropaulo’s
4,316 employees are the underpinnings of the
Company’s Human Resources policy.
38
Remuneration and Benefit Policy
It is based on the Total Remuneration concept,
The smallest wage payed by AES Eletropaulo
is 1.86 times larger than the Brazilian minimum
which includes base salary, benefits, bonuses and
wage (base: may/2006, MW = R$360) and it
other types of variable remuneration. It includes
includes profit sharing program and bonus.
all the benefits secured by law, besides a family
EC5
health plan and a private pension plan for all the
employees – regardless of gender or race – that
perform the same duties in any hierarchical level.
Training and capacity-building
423,444.1 hours were dedicated to training,
The Company has a general wage agreement
professional development and retraining in
with the union of the main occupational group to
2006. Employees were prepared to take on new
negotiate a minimum of benefits for all with the
positions, learn basic and strategic skills, eliminate
local union in the area where it operates.
performance flaws, adapt to new technologies,
la4
practice operating excellence, receive information
about energy efficiency and raise safety levels.
To offer assistance in personal matters,
AES Eletropaulo created the Personal Support
Program (PSP) as an additional benefit. It offers
Employees by Gender
counseling in cases of relationship conflicts,
Male
financial or legal problems, drinking or drug
Female
problems among others through a toll-free phone
LA13
number around the clock. Employees who know
that peers are experiencing personal difficulties
can also call or recommend the service. Anonymity
is preserved in all cases.
2005
The profits and results of the Company are
20.0%
also shared with employees depending on the
achievement of pre-established goals. Additional
bonuses for sustainability contribution are also
80.0%
given, for example, for achieving a social or
environmental performance goal. This program
was introduced after negotiations with an
employees’ committee. The profit sharing program
paid R$30.8 million in 2006.
AES Eletropaulo’s average salary achieved
2006
20.0%
R$2,652.69 in 2006, not counting chief officers
and vice-presidents. This amount is 4.4% higher
than the average of the previous year.
80.0%
39
Education, Capacity-Building and Training
2006
2005
Opex – R$3,048.4
Capex – R$70,789.4
Opex – R$4,421.4
Capex – R$1,400.0
97
119
142,406
68,403
26
21
R$120.0
R$145.7
Percentage of investments in relation to gross revenues
0.03%
0.04%
Percentage of investments in relation to total operating
expenses
0.05%
0.70%
Percentage of investments in relation to total personnel
expenses
0.8%
1.30%
Amount invested
Training hours per employee/year
Number of employees trained
Number of scholarships granted to employees
Amount invested in scholarships
Employees by Educational Level
The Company also dedicated itself to the
Some grade school
Leadership Development Program (LDP), a
Grade School Certificate
corporate program that includes managers and
Some high school
leaders from all AES companies. By 2006, 500
High school certificate
leaders had participated in the program and
Some college
22 LDP “communities” had been created.
College degree
These communities met at the end of the year
at a convention to share their experiences.
LA13
As it follows the learning organization concept,
AES Eletropaulo also held two large events in 2006:
2005
5.7%
5.6%
Emerging Leaders Course, originally developed
by University of Virginia Darden Business
6.4%
School and offered in Brazil for the first time
11.0%
in a partnership with Fundação Instituto de
51.9%
Administração (FIA-USP) (University of São
Paulo Business Administration Foundation
19.4%
Institute).
“Leader Teacher” Program, where six executives
delivered lectures to a audience of 1,200 people.
2006
5.5%
5.4%
7.0%
9.5%
50.9%
21.7%
40
AES Eletropaulo also hosted the First LatinAmerican Operating Excellence Conference.
Employee Profile
AES Eletropaulo believes that the ongoing
200 people from AES companies based in Latin
exchange of experiences is key to the
America participated in the event. They attended
relationships among its employees. With this
the presentations of 72 of the 118 pre-selected
in mind, it encourages diversity in its broadest
technical papers in the Corporate Education
sense. Its personnel includes both experienced
auditorium in São Paulo. The event was intended
professionals who have been in the Company
to promote the production and dissemination of
for years and younger professionals, many of
professional knowledge and make the best and
whom starting their career at AES Eletropaulo.
most innovative technologies developed at AES
companies accessible.
Employees by Age
Employees by Length of Service
Up to 25
Up to 1 year
From 25 to 35
From 1 to 5 years
From 35 to 45
From 5 to 10 years
From 45 to 55
From 10 to 20 years
Over 55
From 20 to 30 years
Over 30 years
2005
2005
10.0%
0.3%
0.3%
10.3%
5.4%
13.2%
17.2%
31.5%
44.4%
34.9%
32.0%
2006
2006
11.1%
0.3%
0.4%
9.5%
8.1%
12.4%
17.1%
44.6%
31.5%
30.4%
34.3%
41
The educational
safety campaign
“Be Close to Those You Love. Be Away from Power Lines” was widely
publicized in the Company’s concession are on radio, TV and billboards as
well as in newspapers and magazines.
Communication
AES Eletropaulo acknowledges the importance
The media outlets connect the Company with
the public. Therefore, AES Eletropaulo acts in a
of informing and being transparent to all its
proactive and transparent manner towards the
stakeholders: shareholders, customers, employees,
press to consolidate a consistent relationship
suppliers, communities, government bodies and
based on mutual respect. The Company answers
regulatory bodies. Due to this, communication is
all readers’ letters sent to newspapers, has a press
an integral part of virtually all Company projects.
office that operates 24 hours a day and is proactive
Moreover, AES Eletropaulo developed
in informing the public about energy supply
advertising campaigns like “Be Close to Those
problems, expected recovery time, operations on
You Love. Be Away from Power Lines”, launched
holidays and special dates (like Carnival, election
at the First National Week of Electricity Safety,
days etc.) and power line accident prevention.
organized by the Brazilian Association of the
The press ran about 3,327 positive articles, 2,366
Electric Energy Distributors (Abradee).
neutral articles and 546 negative articles about the
The campaign ran on the radio, on television, in
Company in 2006.
newspapers and on billboards. The “Turma Lá de
Furthermore, the Company offers its
Casa” (The Folks at Home) campaign, for energy
professionals training to help them interact with
efficiency, and “O Cliente em Primeiro Lugar”
the press, as well as find, prevent and handle
(The Customer Comes First) campaign, about
any possible image crises. The first phase of a
communication channels with customers were
training program for spokespeople, with all vice-
also launched.
presidents, directors and some of the managers of
the Company was held in 2006.
42
A Corporate identity Manual was also developed
The Company also posts its annual reports on
in 2006. It is a publication intended to standardize
the internet and on the intranet in keeping with its
visual communication of all AES group companies
transparency policy. In 2006, electronic versions
in Brazil, with guidelines for design and graphic
of the Annual Report (on the Investor Relations
standards. The manual also contains specifications
site), as well as the Environmental Sustainability
for the use of the Company logo.
and Social Responsibility Reports (on www.
Communication with internal constituencies
is done through the intranet, which now works as
eletropaulo.com.br), were available for external
shareholders.
a press agency and posts daily updates. In 2006,
In pace with this practice, this Annual
the 603 pieces of news about AES Eletropaulo and
Sustainability Report, which includes
other group companies were posted on the intranet.
AES Eletropaulo’s economic and financial
The Ligado (Hooked Up) magazine, released
information as well as its social and environmental
in 2003 with modern graphic design and high
actions in 2006 is available for download on the
editorial quality, is delivered by mail
Company’s web site (www.eletropaulo.com.br).
to employees and some external stakeholders.
This Report is intended to describe to different
It is one of the main means by which the Company
stakeholders all of the Company’s main activities,
renders accounts and informs the public about its
strategies and the main principles and beliefs
activities. It became a thematic publication in 2006
that guide its routine. For further information,
so that it can address issues in greater detail.
please contact AES Eletropaulo’s Communications
Social Responsibility, Environment, Safety and
Department by phone (55 11) 2195-2021 or e-mail
Energy Efficiency have been themes of last
([email protected]) or the Investor Relations
year’s editions.
department ([email protected]).
3.4
1.
2.
1.Press conference:
proactivity and
transparency in the
relationship with
the mass media
2.Campaign launched
in the First National Week
of Electricity Safety
43
AES Eletropaulo is deeply concerned about
The Company follows strict quality standards
communicating with its different stakeholders in
in choosing its partners and has standard
an effective and transparent manner. With this
requirements and criteria to hire suppliers and
in mind, it is determined to always enhance its
service providers.
interaction with them. As a result, it has made
Among others, AES Eletropaulo requires all
available a questionnaire to collect readers’
contractors to adopt safety standards and equipment
opinions and comments about this Sustainability
similar to its own. Whenever the activities to be
Report. Those interested in taking this
carried out can potentially cause environmental
questionnaire can answer it anonymously.
impact, they must be permitted by environmental
It is available on the same link to the file
agencies and the correct disposal of the waste
of this Report, in a pop up window.
produced in these activities must be proven.
AES Eletropaulo also has a clear policy of
Supplier Relations
In line with its commitment to the sustainable
development of its business, AES Eletropaulo
includes specific environmental provisions in all
not using raw materials produced by the illegal
exploitation of natural resources, nor does it
approve of the use of slave and child labor.
The environmental and ethical commitments
contracts it enters into in order to ensure quality
also follow the principles outlined by AES
and suppliers’ full compliance with environmental
concerning US legislation. Due to this, the
legislation while performing their services.
Company regularly checks the veracity of the
information given by its service providers.
HR6
44
HR7
EC6
Environmental Management
The commitment to the environment pervades
AES Group’s goal, premise and environmental
all AES Eletropaulo actions and is one of the
policy worldwide are outlined in the SGA
bases of its sustainability policy, which guides the
(Sistema de Gestão Ambiental) Environmental
Company’s business. This commitment can be
Management System – corporate program.
seen in everyday activities, such as tree pruning
This system, based on ISO 14001:2004, focuses
below power lines, research investment, the use of
on the prevention of environmental impact
clean technology equipment, equipment recycling,
and ongoing monitoring of operating activities.
selective waste collection, correct handling and
The goal is to make all group companies follow
disposal of potentially polluting waste and the
environmental criteria in their activities.
awareness-raising effort among employees and
in the community in general etc.
AES Eletropaulo is concerned about adapting
its activities to the system requirements by raising
awareness in all Company levels and adopting
their principles in all work routines.
45
Actions
Development, assessment and use of alternative
Many measures were taken in 2006 to improve
technologies to adapt its activities to SGA,
environmental management at AES Eletropaulo,
such as equipment to separate water from oil
and as a result, the Company received the Prêmio
after emergencies on and the maintenance
Empresa Sustentável (Sustainable Company Award),
of containment platform, use of epoxy resin
granted by the Meio Ambiente Industrial (Industrial
to contain oil spills, equipment to identify
Environment magazine). Some of the activities were:
and measure the possible presence of PCB
Expansion of SGA through the certification of
(Polychlorinated biphenyl) in the mineral
188 Company sites, including all substations,
oil used and a research proposal for the
administration offices and five service offices.
bioremediation of contaminated areas.
The goal is to keep this recertification for the
EN26
next three years.
Development and integration of the Safety and
Control of the contamination risk by PCB
Occupational Health Management System (SGSSO)
insulating oil. AES Eletropaulo’s Chemical
with the Environment Management System.
Laboratory monitors inflow and outflow of
Introduction of the “Global Connections of
mineral insulating oil or any intervention that
Environment Management” methodology,
may happen in electric equipment. This is done
pursuant to international environmental
through corrective action to reestablish its
conventions and agreements supported by the
chemical and physical properties as an insulating
United Nations.
fluid. Chemical analyses follow the standards
EN26
and parameters laid down by Brazilian Norms
2.10
and Laws like NBR 8.371, NBR 13.882 and
Assessment of the areas where equipment using
Executive Order 12.288 of February 2006.
SF6 (sulfur hexafluoride), a gas harmful to the
AES Eletropaulo regenerated 1,444 thousand
environment. Equipment number was also
liters of oil in 2006.
recorded. The objective is to achieve maximum
EN26
efficiency in handling the gas, reprocess it
and prevent it from being released into the
atmosphere.
EN26
1.
46
2.
3.
1. Instructors of
the Environmental
Management System give
guidance on correct waste
disposal to their peers
2. The amount collected
with recycling is allotted
to social programs
3. The Company participates
in the “Projeto Pomar”,
designed to revive the banks
of Pinheiros River.
Communication and training programs
Hydrogen-powered buses – participation
designed to capacity-build, prevent, influence
in the project for the development of Brazil’s
and raise awareness of stakeholders. To fulfill
first hydrogen-powered bus, which releases no
its commitment to the environment,
pollutants. The participating group includes
AES Eletropaulo believes that it should not only
the federal government, the United Nations
act responsibly, but also raise people’s awareness
Development Program (UNDP), Research
of the importance of preservation.
and Projects Financing (Finep) and private
Tree pruning – to ensure safety and quality in
companies. AES Eletropaulo will be responsible
energy supply, the Company had 121,550 trees
for the specifications, design, approval and
pruned in 2006, a project that is assessed by
connection of the electric substation to the grid,
an agronomist and authorized by municipal
besides ensuring the quality and the availability of
governments.
energy from the substation to the supply point.
Recycling:
EN18
_a social-environmental project that involves
the exchange of PET bottle and aluminum cans
Other actions involving AES Eletropaulo and
for credits on the electricity bill. Developed in
other AES group companies in Brazil were taken
2006 jointly with the recycling company Aleris
on the corporate level. This synergy in corporate
Latasa, this project will start in 2007;
management for the environment, consolidated
_selective waste collection in AES Eletropaulo
in 2006, allows better use of professional talents
facilities that generates funds for social
in common activities and the optimization of
programs; and
resources. This results in greater efficiency and cost
_scrap metal recycling, transformer and meter
reduction. Some projects were developed in 2006:
repairs, as well as the regeneration of the
Reforestation project with native tree species
mineral insulating oil used in transformers,
on the banks of AES Tietê hydropower plant
thus avoiding the purchase of new oil.
reservoirs, an action that will result in the
Pomar Project – participation in the project for
removal of 3 million metric tons of CO2
the environmental recovery and replanting of the
from the atmosphere.
Pinheiros River banks, conceived by São Paulo State
EN26
Department of Environmental Quality. The project
covers 16 km along the left bank of the river.
Detailed analysis of potentialities and
environmental risks inherent to AES companies’
facilities in Brazil, shown in an environmental
report according to the GRI (Global Reporting
Initiative) standards. This report was presented
to external shareholders at a specific event,
and this enabled the companies to open
important communication channels with specific
community groups.
47
Tree R&D
This Research and Development project is
Licensing
intended to:
Electricity distribution was eligible
Study service interruptions caused the
for a licensing waiver given by State
interference of trees on power lines;
and city environmental government bodies.
Find the circuits where most incidents occur and
Only if carrying out the project involved cutting
monitor surrounding trees for causes;
vegetation was there a need for a permit and/or
Record the most critical trees on GIS or
license to cut it, as well as a proper environmental
Georeferenced Information System;
compensation.
Identify and use management practices for urban
In general, AES Eletropaulo activities cause
trees that reduce the risk of trees interfering with
low impact due to low vegetation density, poor
the power grid; and
fauna and short power lines. They are usually
Create a manual of best practices for the
repairs in existing lines, interferences in specific
management of urban trees according to their
points and urban areas.
biological characteristics and environmental
benefits.
Since State Resolution SMA No. 54, of
November 2004, an environmental license has
been required for AES Eletropaulo’s activities,
Software for recording information about trees
on handhelds, with specific screens for recording
and now a Simplified Environmental Impact
Assessment (EAS) must be presented.
their physiological characteristics and assessing
Since Administrative Rule 80, of January
their interference risk was developed in 2006.
2006, the São Paulo Municipal Government has
A tool was also developed in the Company’s
required an Environmental Feasibility Study to
Georeferenced Information System (GIS) that
will make it possible to record information about
trees, such as their geographical location, data
and intervention history. 10,000 trees have been
surveyed, and information about them will be
recorded on GIS in 2007.
1.
1. and 2. Tree pruning
ensures safety and quality in
energy supply
3. Environmental licensing
is a requirement for the
operation of new substations
2.
48
3.
grant an environmental license.
Environmental Education Project
The following documents were
obtained in 2006:
In 2006, AES Eletropaulo was the first company
Installation License (IL) for the works in
to develop an environmental compensation project
Complexo Norte;
fully based on environmental education. The
Installation License (IL) to upgrade Itaim
project was introduced in city Jaraguá, jointly
substation;
with the OSCIP (Organização da Sociedade Civil
Preliminary License to build Tenente Marques
de Interesse Público) – Public Interest Civil
Overhead Transmission Line and Substation;
Organization Instituto Neotrópica, and it focuses
Preliminary and Installation License to upgrade
on themes such as trees, tree planting in São Paulo
Piratininga Sul subtransmission line;
city, project development and the involvement of
Conclusion of Environmental Compensation
the whole school community (parents, employees,
resulting from Taipas Substation and Overhead
teachers and people living in the neighborhood).
Transmission Line;
The Company also sponsored the publication
Beginning of negotiations concerning the
of the educational Handbook of the Tree-Planting
Environmental Compensation for the
Drive in São Paulo city, for distribution in courses
construction of Tiradentes Substation and
of community involvement, community leadership,
Overhead Transmission Line; and
environmental legislation and technical norms.
Beginning of the bidding process to regularize
the existing infrastructure – according to the
Environmental
São Paulo State Environmental Department.
Performance Indicators
Waste
EN21 EN22
Waste Management
Non-hazardous Waste
Type of Waste
Amount
Unit
Destination
25
Piece
Recycling
264
Kg
Recycling
Paper/cardboard
96,865
Kg
Recycling
Plastic
29,261
Kg
Recycling
Glass
144
Kg
Recycling
Debris
812
M³
Disposal in inert waste landfill
3,424
M³
Disposal in Class 2A landfill
35,400
Kg
Disposal in Class 2A
and inert waste landfill
Ink toners and cartridges
Metal
Regular garbage
Waste from safety zone cleaning (*)
* Safety zone beneath transmission lines.
( )
49
Hazardous waste
Type of Waste
Amount
Unit
Destination
14,430
kg
Class 1 landfill
17,411
kg
Specialized recycling
PCB Capacitors
350
kg
Incineration
Agrochemical packaging waste
105
Piece
Recycling
Material soaked in oil
96,383
kg
Co-processing
Mercury vapor bulbs
36,667
Piece
Specialized recycling
8,095
kg
Co-processing
23,180
kg
Co-processing
Lubricant oil
1,810
L
Re-refining
Sandblasting waste
1,304
kg
Co-processing
48
Items
Inertization/Incineration
17,300
Piece
Industrial laundering
Asbestos
Stationary battery
Expired paint
Mineral insulating oil
Medical waste
Industrial towels
Total water disposal by type and destination
Effluent generation
Type of
effluent
Generation
class
Treatment
Effluent
destination
Amount
Effluent generated by
sewage infiltration into
underground utility lines
Sewage
Occasional
-
Sabesp
260 m3
in 2006
Transformer washing at
AES Serviços. The water
outflow of the high pressure
washer used to wash the
tanks is 1,200 liters/hour.
It is used about 5h/day
Oil
Continuous
Water-oil
separating
system
Sabesp
6 m3/day
1. Source: Underground Distribution – Benedito Melo – Sent on 01/10/2006.
2. Source: AES Serviços – Paulo Fiorentini – Sent on 01/09/2006.
50
Material Sold as Scrap
Amount
Unit of Measurement
602,100
kg
Bronze
4,960
kg
Wood spool
1,373
Piece
407,751
kg
20,536
Piece
1.390,679
kg
Wood packaging material
103,020
kg
Ceramic materials
509,343
kg
6,364
Piece
38,463
kg
Aluminum*
Copper**
Wood crossarms
Iron
Power poles
Reactors
* includes aluminium in the forms: raw, isolated and in parts.
** includes copper in the forms: raw, isolated and in parts.
Legal requirement
Limit (oil
and grease)
Analytical
result
Date of
chemical
analysis
Treatment
cost
Effluent
transportation
cost
State executive order
8.468 article 19A
– Effluent disposal in
sewage systems
150 mg/kg
-
-
R$3,425.12
R$11,180.00
State executive order
8.468 article 19A
– Effluent disposal in
sewage systems
150 mg/kg
228 mg/kg
12/12/06
-
-
51
Emissions
The data refer to fluoride gas used in cooling
SF6 emissions
equipment, except for FM 200, which is used in
50 kg of SF6 gas were used in the maintenance of
firefighting system;
subtransmission circuit breakers.
R134 fluid – no consumption in 2006;
AES Serviços treated 396 kg of SF6 used in 11
R22 fluid – consumption estimated at
circuit breakers in 2006. This prevented the gas
about 20 kg; and
from being released into the atmosphere.
FM200 fluid – no consumption in 2006.
SF6 insulated equipment in the electric system:
EN16
EN17
EN19
EN20
Circuit breakers: 429 units totaling 2,129 kg of SF6;
Canaã ETD: 1,000 kg of SF6;
Paula Souza ETD: 1,280 kg of SF6;
Total: 4,409 kg of SF6 in 2006, or a 0.64% rise in
comparison with 2005;
Fuel Consumption
Own vehicles
Amount (‘000 liters)
Amount (m3)
Distance traveled in ‘000 km
144.4
144.4
949.5
1,468.8
1,468.8
5,641.4
Gasoline
842.2
842.1
5,990.8
Flex
335.6
335.6
2,957.1
CNG
5.3
5.3
19.9
200.9
200.9
784.9
2,997.2
2,997.1
16,343.6
Alcohol
Diesel
CNG/Gasoline
Total
EN29
Energy Consumption
EN3
EN4
EN29
Type
Unit
Total
Amount of electric power to meet the demand
GWh
37,809
Own power consumption
GWh
33
m3
2,997
Captive consumer consumption in 2006
GWh
31,689
Total direct power consumption
GWh
6,120
Power generated to meet the expected internal demand
GWh
38,256
POT Power (safety margin calculated to meet the expected demand, but that
S
was not consumed and is re-sold to the power market)
GWh
446
Power consumed by physical losses (technical and commercial)
GWh
5,364
Power generated to meet the expected internal demand
GWh
38,256
Consumption of vehicle fuel
52
Vehicle fuel consumption by type
Alcohol
Diesel
Gasoline
Flex
CNG
CNG/Gasoline
4.82%
49.01%
28.10%
11.20%
0.18%
6.70%
Percentage of energy purchased by type
Hydropower
Thermal
Biomass
Wind
95.80%
3.17%
0.95%
0.09%
Other Indicators
Nature
Observations
Total water withdrawal by source.
123,155 m³ in 2006. The rise in relation to 2005 is
due to leaking and renovation of facilities.
EN8
Location and size of land owned, leased, managed in, or
adjacent to, protected areas and areas of high biodiversity value
outside protected areas.
Unchanged in comparison to 2005.
EN11
Description of significant impacts of activities, products, and
services on biodiversity in protected areas and areas of high
biodiversity value outside protected areas.
Unchanged in comparison to 2005.
EN12
Other relevant indirect greenhouse gas emissions by weight.
Existing fuel consumption data have not been
converted into emissions because the conversion
database was inappropriate.
EN17
NOx, SOx, and other significant air emissions by type and
weight.
Existing fuel consumption data have not been
converted into emissions because the conversion
database was inappropriate.
Total number and volume of significant spills.
Number of events: one. Amount spilled: 280
liters of oil.
EN23
Monetary value of significant fines and total number of nonmonetary sanctions for non-compliance with environmental
laws and regulations.
Monetary value = R$0.00
Total 2006 = 3
Total 2005 = 10
EN28
SGA (Environmental
Management System)
Total environmental protection expenditures and
investments by type (R$ thousand).
1,320.5
Liabilities
557.3
Waste
116.9
Others
184.1
Projects and Improvements
390.7
R&D
344.3
Licensing
155.0
Energy Efficiency
TOTAL
EN20
EN30
2,000.0
5,068.9
53
Social Management
AES Eletropaulo is constantly seeking to
Among the actions adopted by
become more involved in the community, so
AES Eletropaulo are the adhesion to the Global
it supports projects that are in line with its
Pact and the Millennium Goals, the preparation
corporate strategy. All its activities in different
of social and environmental reports based on
areas are always geared to sustainability in its
Ethos-Abradee Indicators and the guidelines
broadest sense and take into account economic,
of the Global Reporting Initiative – version 3
social and environmental aspects. Therefore,
(GRI – G3) respectively. The Company seeks to
social actions sponsored by AES Eletropaulo
fulfill the 10 commitments of Programa Empresa
are related to the Company’s core business and
Amiga da Criança da Fundação Abrinq (Abrinq
involve a close interconnection among operating,
Foundation’s Program “Company that is a Friend
communication, social responsibility and
of Children”), including the donation of 1% of the
environmental areas in order to structure and
income tax due to the Children’s and Teenagers’
develop integrated projects.
Rights Municipal Funds of cities that fulfill their
The Program for the Regularization of Illegal
Electricity Connections is a clear example of this
policy based on broad sustainability. The program
obligations. These funds give financial support to
worthy organizations in the field.
One of the pillars of AES Eletropaulo’s
has economic and environmental aspects, since
social policy is to sponsor education and culture.
it is designed to reduce energy loss, and social
An internal committee made up of professionals
aspects, since it promotes citizenship, integration
from several areas of AES Eletropaulo and
with the community, safety and education for the
other group companies in Brazil (AES Tietê
rational use of electric power.
and AES Uruguaiana) makes decisions as to the
allocation of funds to sponsor cultural activities.
54
All programs and projects submitted to high
The program, which has existed since the
management levels meet the requirements of
1980s, provides a source of income for borrowers,
the Cultural Policy, which favors actions in
who are responsible for watching, hoeing and
underprivileged communities on the outskirts
cleaning these areas. In 2006, 2.6 million km2 of
of the concession area. The Company’s goal is to
land in transmission line safety zones were used
use all the funds coming from fiscal incentives to
by 1,200 borrowers.
sponsor music and reading projects intended to
promote citizenship mainly in needy communities.
Another activity that started in 2006 as
Books
Over the last three years, AES group companies
a result of the corporate integration of AES
in Brazil have donated 123,500 books. Among the
companies in Brazil was the assessment of the
actions taken by AES Eletropaulo to encourage
companies concerning sustainability issues. The
reading are:
survey conducted by BSD consulting aims to
The creation of 50 Reading Rooms in schools,
improve indicators related to this issue through a
cultural centers and organizations as a means
collaborative effort among all areas.
to increase the access of underprivileged
The adoption of these and other actions
people to books and information and to value
throughout AES Eletropaulo resulted in a sharp
the Portuguese Language. Initially, each room
improvement in the Company’s ranking in
received a collection of 1,000 books, 500 of
Prêmio de Responsabilidade Social da Associação
which for consultation and the other 500 for
Brasileira de Distribuidores de Energia Elétrica
loan. The project is a partnership with Instituto
(Abradee Brazilian Association of Electric Energy
Oldemburg de Desenvolvimento (Oldemburg
Distributors’ Social Responsibility Award) in
Development Institute), Record publishing
2006, when the Company rose from 19th to
house and municipal governments;
9th in relation to the previous year. Due to the
The opening of the “Embarque na Leitura” (Get
Company’s efforts toward sustainability and the
on Board in Reading) library, at Luz Metro
results achieved, AES Eletropaulo continued to be
station, with a collection of 3,000 books for
on Bovespa’s Corporate Sustainability Indexise for
loan free of charge for Metro riders. The São
the second year in a row.
Paulo Metro Company offered the space and
AES Eletropaulo (jointly with another group
Main Projects
company, AES Tietê) sponsored facility building
Developed in 2006
and the maintenance of the project, devised by
Instituto Brasil Leitor; and
Income generation
2007 projects: a new updated edition
Community vegetable gardens
of Almanaque Socioambiental (Social-
The Company lends plots of land in safety zones
Environmental Almanac) jointly with Instituto
beneath its transmission lines to individuals and legal
Socioambiental (Social-Environmental
entities so that they can plant community vegetable
Institute), the release of Braille books (in a
gardens and keep garden plants.
partnership with Dorina Nowill Foundation)
and the sponsorship of the book “Energia
não se aposenta” (Power Doesn’t Retire) with
Associação dos Aposentados da Fundação Cesp
(Cesp Foundation’s Retirees’ Association).
55
Internal stakeholders are also benefited
Thirty large events were held in state and city
by reading encouragement actions. In 2006,
public schools. Almost 200,000 people attended
the Company enlarged the collection of AES
them. The project included visits to 67,000 homes in
Eletropaulo’s technical library. This makes it possible
the surroundings of the schools to inform about the
for the employees of all AES group companies in
rational use of electric power and conduct surveys
Brazil to consult a lot of different national and
about consumer habits. In the week before the
foreign books. There were more that 16,000 books in
event, the Company holds lectures about the risks
the library and over 3,000 loans in 2006.
related to electric power and its efficient use, besides
announcing writing contests about this topic for
Education and Energy Efficiency
students.
Fique Ligado (Stay Tuned)
An educational program in public schools in the
Music
concession area. It promotes the concept of energy
Sponsorship (jointly with AES Tietê) for the
efficiency by raising awareness of the importance of
Mozarteum season. Mozarteum is a cultural
the good use of electricity by means of a process that
organization that holds excellent performances
values the teacher/student relationship. The program
of music, classic and contemporary dance.
served 5,850 children in nine public schools in São
19 concerts attended by 45,640 people were
Paulo in 2006. The goal for 2007 is to carry out this
sponsored in 2006. The 2007 goal is to increase
project to 30 schools.
sponsorship and make it possible for internal
stakeholders to attend the performances.
Eletropaulo na Comunidade
(Eletropaulo in the Community)
Complete project that combines technicaloperating aspects and social responsibility aspects.
It is part of the Energy Efficiency Program. It takes
entertainment, services and information about the
rational and safe use of electricity to low income
communities in the concession area. A partnership
with Metodista and Uninove Universities and Teruya
Hairdressing School, this project also provided
free services, such as haircuts, blood pressure
measurements, teeth check-ups, global posture
reeducation and tips for a healthy diet among others.
1. The 2006 edition of the
“O Consumidor É Show”
event drew 50,000 to
Parque da Independência
2. Children assisted by
the projects “Luz e Lápis”
and “Circo Escola”, both
funded by the Company
3. The “Eletropaulo na
Comunidade” project
disseminates in public
schools information about
the rational and safe use of
electric power
2.
56
1.
3.
Education and culture
are prominent aspects of the social policy of AES Eletropaulo, which promotes
and supports projects that are in line with its corporate strategy and focus mainly
onfostering citizenship.
Domingo Show Eletropaulo
Participants can ask questions about the rights
(Eletropaulo Sunday Show)
and duties at the participating organizations’
Brazilian music concerts held on the outskirts
stands. They also receive pamphlets and gifts.
of AES Eletropaulo’s concession area to provide
A large show with a famous Brazilian singers is
culture and entertainment to underprivileged
another attraction. Admission is free. 2007 goal:
communities. Seven events attended by 162,000
to hold the event again with the same quality and
people were held in 2006.
collect food donations.
4.16
Acorde para o Meio Ambiente
(Wake Up to the Environment)
Symphony orchestra performances – sometimes
along with Popular Brazilian Music performances
4.16
Theater
“A Pecadora Queimada” and “Anjos
Harmoniosos” plays were sponsored.
4.16
– in parks. Attendees are encouraged to bring one
kilo of non-perishable food as a symbolic admission
Museum
fee. The food collected is sent to municipal food
Portuguese Language Museum
banks. This program is organized by Pró Cultura
AES Eletropaulo is a partner of the Estação da
Marketing Cultural in a partnership with the State
Luz da Nossa Língua, a museum for the Portuguese
Environmental Department and private companies.
Language that opened in the Luz Station building
4.16
in downtown São Paulo in March 2006. The project
was an initiative of the São Paulo State Government
O Consumidor é Show
and of Roberto Marinho Foundation, with the
(The Consumer is a Show)
support of private companies.
A joint event with Jornal da Tarde
4.16
(a newspaper) that aims to bring the population
closer to government bodies, companies and
NGOs that advocate consumer rights.
57
AES Eletropaulo – Cultural Projects Chart
Closed (Paid) Events – 2006
Date
Venue
Number of
Attendees
Total Number
of Attendees
1/19/06
242
242
1/20/06
232
474
227
701
245
946
92
1,038
1/28/06
108
1,146
1/29/06
145
1,291
1/21/06
1/22/06
1/27/06
A Pecadora
Queimada
(theater
play)
Sérgio Cardoso
Theater – Paschoal
Carlos Magno Room
Target Audience
Over 14 years old
5/8/06
Mozarteum
São Paulo
(São Paulo Hall)
1,445 (theater
capacity: 1,501)
2,736
Upper, middle
and lower classes
5/9/06
Mozarteum
São Paulo
(São Paulo Hall)
1,419 (theater
capacity: 1,501)
4,155
Upper, middle
and lower classes
6/5/06
Mozarteum
São Paulo
(São Paulo Hall)
1,326 (theater
capacity: 1,501)
5,481
Upper, middle
and lower classes
6/6/06
Mozarteum
São Paulo
(São Paulo Hall)
1,486 (theater
capacity: 1,501)
6,967
Upper, middle
and lower classes
6/26/06
Mozarteum
São Paulo
(Alfa Theater)
946 (theater
capacity: 1,134)
7,913
Upper, middle
and lower classes
6/27/06
Mozarteum
São Paulo
(Alfa Theater)
916 (theater
capacity: 1,134)
8,829
Upper, middle
and lower classes
7/31/06
São Paulo
Mozarteum (São Paulo
Municipal Theater)
1,336 (theater
capacity: 1,580)
10,165
Upper, middle
and lower classes
8/1/06
São Paulo
Mozarteum (São Paulo
Municipal Theater)
1,120 (theater
capacity: 1,580)
11,285
Upper, middle
and lower classes
9/18/06
Mozarteum
São Paulo
(São Paulo Hall)
1,371 (theater
capacity: 1,501)
12,656
Upper, middle
and lower classes
9/19/06
Mozarteum
São Paulo
(São Paulo Hall)
1,327 (theater
capacity: 1,501)
13,983
Upper, middle
and lower classes
10/2/06
Mozarteum
São Paulo
(São Paulo Hall)
1,449 (theater
capacity: 1,501)
15,432
Upper, middle
and lower classes
10/23/06
Mozarteum
São Paulo
(São Paulo Hall)
1,258 (theater
capacity: 1,501)
16,690
Upper, middle
and lower classes
10/25/06
Mozarteum
São Paulo
(São Paulo Hall)
1,241 (theater
capacity: 1,501)
17,931
Upper, middle
and lower classes
TOTAL
58
Event
17,931
Performers
Investment
% Tax Benefit
(Rouanet Law for
cultural sponsorship)
Tradeoff
Associated
Campaigns
Dora Pellegrino, Rosa Douat, Rogério
Freitas, Franco Almada, Marco Audino,
Kate Hansen, Giovanna de Toni and
Teresa Montero, Karan Machado,
105,000.00
Alexandre Moffati, Chico Lá, Leandro
Santana, Leonardo Britto, Érica
Menezes
100
Performance
None
WDR Sinfonie-orchester Köln,
Semyon Bychkov, conductor
Sayaka Shoji, violin
110,000.00
100
Sponsorship
None
WDR Sinfonie-orchester Köln
Semyon Bychkov, conductor
110,000.00
100
Sponsorship
None
Freiburger Kammerphilharmonie,
Giuseppe Verdi Choir (Freiburg)
& Bahia Barroque Choir
Andreas Winnen, conductor
110,000.00
100
Sponsorship
None
Freiburger Kammerphilharmonie,
Giuseppe Verdi Choir (Freiburg)
& Bahia Barroque Choir
Andreas Winnen, conductor
110,000.00
100
Sponsorship
None
Trondheim Soloists
110,000.00
100
Sponsorship
None
Trondheim Soloists
110,000.00
100
Sponsorship
None
110,000.00
100
Sponsorship
None
110,000.00
100
Sponsorship
None
Gidon Kremer, violin & Kremerata
Baltica
110,000.00
100
Sponsorship
None
Gidon Kremer, violin & Kremerata
Baltica
110,000.00
100
Sponsorship
None
Rudolf Buchbinder, piano & Zürcher
Kammerorchester
110,000.00
100
Sponsorship
None
Dame Felicity Lott, soprano & Maciej
Pikulski, piano
110,000.00
100
Sponsorship
None
Dame Felicity Lott, soprano & Maciej
Pikulski, piano
110,000.00
100
Sponsorship
None
Mitchell-Tomter-Poltéra-Stott Quartet
Priya Mitchell, violin/Lars Tomter,
viola/Christian Poltéra, cello/Kathryn
Stott, piano
Mitchell-Tomter-Poltéra-Stott Quartet
Priya Mitchell, violin/Lars Tomter,
viola/Christian Poltéra, cello/Kathryn
Stott, piano
4.16
59
AES Eletropaulo – Cultural Projects Chart
Open (Free) Events
60
Number of
Attendees
Total
Number Of
Attendees
Date
Event
Venue
Target Audience
10/10/04
Sunday Show
Embu das Artes
(Campo do Jardim
Independência)
22,000
22,000
Local community
10/17/04
Sunday Show
Itapevi
25,000
47,000
Local community
11/28/04
Wake up to the
Environment
São Paulo
(Villa Lobos Park)
5,000
52,000
All social classes
3/13/05
The Consumer
Is a Show
São Paulo (Anhembi)
25,000
77,000
Upper, middle and lower
classes
6/5/05
Wake up to the
Environment
Ribeirão Grande
(Parque
Intervales)
5,000
82,000
All social classes
6/19/05
Sunday Show
Ribeirão Pires
(Ayrton Senna
Cultural Center)
30,000
112,000
Local community
8/14/05
Sunday Show
Diadema (Praça
da Moça – Centro)
20,000
132,000
Local community
9/11/05
Wake up to the
Environment
Mauá (Paço
Municipal
de Mauá)
3,000
135,000
All social classes
10/9/05
Sunday Show
Osaco
(Av. Bussocaba)
8,000
143,000
Local community
10/30/05
Sunday Show
Embu Guaçu
(Praça Ivan Braga)
15,000
158,000
Local community
11/20/05
Sunday Show
Cajamar (Prof. Walter
Ribas de Andrade
Event Center)
12,000
170,000
Local community
12/18/05
Wake up to the
Environment
São Paulo (Botanic
Garden)
6,000
176,000
All social classes
3/5/06
Wake up to the
Environment
Santos
(Gonzaga Beach)
9,000
185,000
All social classes
3/19/06
The Consumer
Is a Show
São Paulo
(Ipiranga Park)
50,000
235,000
Upper, Middle and
Lower Classes
Performers
Investment
% Tax Benefit
(Rouanet Law for
Tradeoff
Associated Campaigns
Fábio Jr. and Marcelo D2
269,330.00
64
Performance
None
Pitty
230,080.00
64
Performance
None
60,000.00
100
Performance
20 kg of food were collected
and donated to Programa
Fome Zero (Zero Hunger Program)
100
Performance
Philarmonik Orchestra
Jorge Aragão
and Marcelo D2
Brazilian Wind
Instrument Orchestra
from Tatuí
50,000.00*
100
Performance
120 kg of food collected and donated to
Ribeirão Grande Social Solidarity Fund
Russo, Cauby Peixoto,
Kiko Zambianchi and
Biquini Cavadão
237,081.00
64
Performance
None
Maurício Gasperini,
Ritchie and Rádio Taxi,
Francisco Petrônio and
Paulo Ricardo with PR.5.
191,913.00
64
Performance
None
Poços de Caldas
Symphony Orchestra and
Elba Ramalho
100,000.00*
100
Performance
30 kg of food were collected and donated
to Programa Fome Zero (Zero Hunger
Program)
Wanderléa, Russo
and Nando Reis
174,209.06
64
Performance
None
Francisco Petrônio
and Ultraje a Rigor
233,457.33
64
Performance
None
Francisco
Petrônio and IRA!
225,457.00
64
Performance
None
Philarmonik Orchestra
and Bibi Ferreira
50,000.00*
100
Performance
35 kg of food were collected
and donated to Programa
Fome Zero (Zero Hunger Program)
60,000
100
Performance
70 kg of food collected and donated to
Santos Social Fund
Poços de Caldas
Symphony Orchestra with
the special participation
of sopranist Abel Degli
Angele – 65 musicians
3,300 metric tons were donated
to the following organizations :
Daniel and IRA!
430,000
100
Performance
Congreg. Irmãs Carmelitas Miss Sta. Tereza Menino Jesus
– IASE, Associação Beneficente Educacional Lajeado, Centro
Comunitário Jardim Japão, Associação Pro Moradia União e
Vida, Associação Beneficente Jardim Lapena, Grêmio Recreativo
Dimensão Esporte Clube, Associação dos Moradores da União
de Vila Nova, Centro Comunitário São Gabriel, Clube de Mães
Tereza Teixeira do jardim Robru, Associação de Mães Boas
Novas, Ass. Apoio Idoso/Menor Carente Jd. Robru e Adj.,
Inst. Cultural Esp. Ed. e de Captação Comunitária, Grupo
Apoio Morad. Sta. Etelvina e Adj. – SANME, Instituição de
Fraternidade Terceiro Milênio, Associação Beneficente Estrela
Nascente, Associação Benef. Comunitária Mãos Estendidas,
Associação Apoio Idoso/Menor Carente Jd. Robru Adjacências,
Instituição de Fraternidade Terceiro Milênio, Grupo de Apoio
dos Moradores Sta. Etelvina e Adjacências – SANME, Clube de
Mães Tereza Teixeira do Jardim Robru, Associação de Mães
Boas Novas, Centro Espírita Irmã Nice, Comunidade Assistencial
Ponte Pequena – Lar Cosme e Damião, Igreja do Evangelho
Quadrangular, Igreja Presbiteriana do Centenário, Inst. Cultural
Esportivo Educacional e de Capacitação Comunitária.
61
Date
3/22/06
to
5/28/06
Venue
Number of
Attendees
BR-3 (Vertigem
Theater)
São Paulo (Tietê
River, from Cebolão
to Complexo Ulisses
Guimarães – Rod.dos
Bandeirantes
3,900 (60
performances
with 65
spectators each)
238,900
9,000
247,900
5/7/06
Mozarteum
São Paulo
(Ibirapuera Park)
6/4/06
Target Audience
Upper, middle
and lower classes
Upper, middle
and lower classes
10,000
257,900
1,500 (number
of seats: 1,500)
besides the
changing
number of
park visitors
259,400
All social classes
6/25/06
Wake up to the
Environment
São Paulo
(Villa-Lobos Park)
7/16/06
Sunday Show
Ribeirão Pires
31,000
290,400
Local community
7/23/06
Sunday Show
Ribeirão Pires
39,000
329,400
Local community
7/30/06
Sunday Show
Ribeirão Pires
7,000
336,400
Local community
8/6/06
Sunday Show
Ribeirão Pires
45,000
381,400
Local community
8/11/06
Sunday Show
Rio Grande da Serra
8/12/06
Sunday Show
Rio Grande da Serra
9/17/06
Mozarteum
São Paulo
(Ibirapuera Park)
10,000
11/5/06
Sunday Show
Caucaia do Alto
(Subdistrict of Cotia)
10,000
Local community
30,000
TOTAL
* Bonus granted to the Company.
62
Total
Number of
Attendees
Event
411,400
Local community
Local community
421,400
421,400
Local community
Performers
Vertigem Theater Cast
WDR Sinfonie-orchester
Köln
Semyon Bychkov,
conductor
Freiburger
Kammerphilharmonie,
Giuseppe Verdi Choir
(Freiburg) & Bahia
Barroque Choir
Andreas Winnen,
conductor
Poços de Caldas
Symphony Orchestra and
Grupo Bachorando
% Tax Benefit
Investment (Rouanet Law for
Tradeoff
3,000
110,000.00
60,000
0
Associated Campaigns
Support
None
Sponsorship
None
100
Performance
71.97 kg of food were collected
and donated to NGO Ação da
Cidadania, which distributes
it to registered charities
64
Performance
None
100
Guilherme Arantes
Banda Catedral
84,000
Marlon and Maicon
IRA!
Hugo and Tiago
Roger and Rogério
(singers from Mauá)
82,555.00
Gidon Kremer, violin
& Kremerata Baltica
110,000.00
100
Sponsorship
Rádio Táxi Band
(from Cotia and Caucaia)
149,280.00
64
Performance
4.16
63
Children
Sponsorship for the release of the G3 version of
Circo das Artes (Arts Circus)
GRI in Brazil and participation in a study group
It was created in 1989 and is intended to
consisting of sponsoring companies and experts.
offer social and cultural resources to teenagers
2007 goal: to promote GRI in the Company.
and children in risk situation and from needy
Support for the campaign of the environmental
communities. In 2006, Circo das Artes benefited 370
organization WWF-Brasil to raise funds for
children and teenagers between 5 and 17 years old.
the Protected Areas in the Amazon Region
Projeto Luz e Lápis
Program. Between June and July, power bills
(Light and Pencil Project)
had an announcement of the fund-raising
Also created in 1989, it has two free day-care
campaign. Career counseling for the participants
centers that offer social and cultural resources
of “Jovem Cidadão” (Young Citizen) and Circo
to children of low-income families. It currently
das Artes projects, a partnership of the Social
serves 248 children (124 in each site) aged
Responsibility and Human Resources areas.
between 1 and 7.
Company trainees were offered a preparation
Donation to Fumcad (CMDCA)
for the labor market workshop, intended to help
In 2006, R$948,000 was donated to five
Children’s and Teenagers’ Rights Municipal
young people prepare better for a career.
4.16
Funds. The cities that received the benefit were
São Paulo, São Bernardo, Diadema, Itapecerica
da Serra and Cotia.
Relationship with the Government
The Company is often in contact with city, state
and federal officials and representatives of regulatory
Others
Support and encouragement to employee
volunteering on the intranet and in the
respect and transparency.
AES Eletropaulo’s relationship with public
institutional publication, fund-raising campaigns
officials is based on the principles of ethics
and events to pay recognition to outstanding
and transparency, in line with AES Group’s
teams.
international policies, outlined in its Code of Ethics.
Support to hospitals and fund-raising campaign.
There are many anti-corruption practices, including
In April, all São Paulo city bills brought a
a communication channel with executives to report
message about the work of Hospitais da
violations and punitive measures for any employees
Irmandade da Santa Casa de Misericórdia de
involved in bribery of public officials. The Company
São Paulo, traditional hospitals in the city.
also has a clear policy of not supporting and not
This action promoted the fund-raising drive
participating in processes to manipulate public or
in behalf of Santa Casa’s social activities. In
private invitations to bid.
October, Hospital Santa Marcelina had the same
benefit. 2007 goal: to fulfill more requests as
often as possible throughout the year.
64
bodies. These contacts are always made with mutual
4.16
Risk Management
AES Eletropaulo has strict procedures
surveillance systems and joint actions with public
to mitigate risks inherent to its business
security authorities to cut down on cable and
in the technical-operating, administrative,
equipment theft.
commercial and financial areas. The Company
Climate/disaster risk
has a specialized team that constantly monitors
Among other actions, AES Eletropaulo has
activities and seeks efficient strategies to avoid
advanced meteorological systems, agreements
exposure to any potential risk factors.
with specialized companies and a strategic plan,
with procedures and resources for emergency
Risks Related to Operating Activities
services. To reduce losses, it has insurance
Operating risk
contracts whose coverage is determined with
Service in the distribution system can be
interrupted due to unexpected factors, accidents,
faulty or inadequate processes and systems, as
expert advice.
Labor accident risk
The Company has strict safety procedures and
well as human failure, power theft, material theft
uses the most advanced equipment to prevent
and vandalism. Several procedures can minimize
accidents involving its own employees. It also
these risks, such as the adoption of the Work
requires the same standards from contractors.
Management program, investment in electronic
65
A specialized team
is in charge of monitoring activities and seeking strategies to
prevent exposure to potential risk factors.
It adopted the BBS program (Behavior Based
on Safety) to reinforce the culture of safety in
Environmental risk
Pursuant to environmental legislation, the
everyday activities.
Environmental Management System (certified
Market risk
by ISO 14001/2000) was introduced and,
The concession contract grants exclusive
with the follow-up of Cetesb (Companhia de
power distribution rights to AES Eletropaulo in
Tecnologia de Saneamento Ambiental, the São
the São Paulo Metropolitan Region. Any possible
Paulo Environmental Agency), all environmental
losses arising from customer migration to the free
liabilities from pre-privatization activities are
market will be mitigated by a corresponding drop
being dealt with.
in energy purchase, besides the tariff for the use of
Regulatory risk
the distribution system (Tusd).
Technological risk
The Company has strict system operating
As an electric power distribution
concessionaire, AES Eletropaulo has to comply
with all the provisions of its concession contract
controls that use diagnostic, inspection and
and all regulatory body resolutions. All the
maintenance techniques according to the MCC
requirements are always complied with in order
(Manutenção Centrada na Confiabilidade, or
to avoid fines or, in an extreme situation, the loss
Reliability-Centered Maintenance) concept.
of the concession.
It invests in Research and Development and
To manage these risks, the Company has had a
in the upgrade of IT, telecommunications and
Risk Management Committee for two years.
information systems equipment.
It meets every week to outline strategies and
assess control methods. Additionally, it measures
the impact of the strategies adopted, both on the
finances and on the image of the Company.
66
Community risk
AES Eletropaulo believes that its relationship
This result allowed a rise in the Standard & Poor's
and Fitch international scale ratings for AES
with communities can have a positive or a negative
Eletropaulo, from B+ to BB-. Concerning national
impact on its power distribution activity. As a
scale ratings, the Fitch rating went up from BBB+
result, it is firmly committed to conducting its
to A, whereas the S&P rating rose from BBB+ to A-.
business so as to ensure maximum safety for the
Foreign exchange risk
communities near its facilities.
Labor judicial risk
The Company follows all effective rules, and
Since it restructured its debt, the Company
has been changing most of its Dollar denominated
debt to Reais. Consequently, it reduced its foreign
it is determined to promote the well-being of its
currency obligations from 6% in December 2005
employees to minimize labor lawsuits.
to just 1.6% at the end of 2006. In addition,
Intellectual capital risk
95.9% of its foreign currency debt was hedged for
In order to recognize and encourage the talents
that make up its personnel, AES Eletropaulo offers
opportunities for growth and career building and
holds training programs on a regular basis.
exchange rate risk in late 2006.
Interest risk
36.8% of all AES Eletropaulo’s consolidated
debt was adjusted by Selic on December 31, 2006.
This strategy is intended to benefit the Company
Financial Risks
Credit risk
with the downward trend of the interest rate.
1.2
The ability to raise funds grew considerably
after the financial restructuring process in 2006.
It resulted in a 19.8% drop in the net debt and
better terms for this debt, with extended
maturity dates, lower costs and the
elimination of the foreign currency exposure.
67
Intangible Assets
Provider of an essential utility like electric
power distribution, AES Eletropaulo always seeks
image of the Company and of AES group as
to improve its management and operations
an investor/operator in the electricity sector.
by establishing new relationship standards.
Throughout the year, many actions were taken
To achieve a competitive edge and its mission,
based on proactivity and transparency: the
the Company encourages innovative solutions
Company was closer to opinion shapers and was
and invests continually on technological tools
able to expose its brand. This cannot be directly
to improve its performance.
measured, but it does contribute to adding
This strategy brings important benefits, which
reflect on the satisfaction levels of its employees
and customers. They add value to the Company
and ensure good results for its shareholders.
Much of the work done cannot be measured in
financial terms, and therefore, does not reflect
directly on the economic and financial performance.
68
An example is the effort to consolidate the
credibility to the image of the AES Eletropaulo.
Among the Company’s intangible assets are:
Knowledge Management
efficiency in operations;
The electricity sector, due to its peculiarities,
customer service excellence;
requires professionals with specific technical and
efficient management tools;
sector-related skills. AES Eletropaulo recognizes
a transparent and ethical relationship with all its
the talent of its employees and always tries to
stakeholders;
encourage them to have new ideas and seek new
image projected to the public through the press
work methods. In this regard, the Company holds
office;
courses and events, where its employees can
professional development, experience gain and
improve their knowledge and share experiences
knowledge acquisition for its personnel;
with each other as well as professionals from other
management based on broad sustainability, with
AES companies.
a responsible performance in the economic,
financial, social and environmental areas;
investments in technology and Research and
Development;
having as controlling shareholders AES
Corporation, one of the largest investor groups in
the electricity sector worldwide, with generation
and/or distribution operations in 26 countries,
and BNDES, an investor committed to the best
business management and the transparency of
the activities; and
recognition of the Company in different areas,
among others.
1. The Company invests
in training and internal
knowledge dissemination
2. In 2006, 182 AES
Eletropaulo sites
received the ISO 14,001
environmental certification
3. The First Latam
Operating Excellence
Conference promoted
knowledge exchange among
professionals from all AES
companies in Latin America
2.
1.
3.
69
Economic and Financial Performance
AES Eletropaulo posted a net income of
Main negative impacts on 2006 results
R$373.4 million in 2006, in comparison to a
greater deductions from gross revenues due
R$155.5 million loss in 2005. It was able to
to the higher expenses on PIS (Programa
reverse a situation where it had an accumulated
de Integração Social, or Social Integration
loss until the second semester.
Program), Cofins (Contribuição para o
As a result, the Company managed to absorb
Financiamento da Seguridade Social, or Tax for
the loss accrued in 2005, and it was possible
Social Security Financing) and ICMS (Imposto
to pay dividends totaling R$130.4 million
sobre Circulação de Mercadorias e Serviços, or
(R$3.23/´000 preferred shares and R$2.94/´000
Value Added Tax on Sales and Services);
common shares).
extraordinary provision for the reassessment
of the accounting criterion for civil and labor
Main positive impacts on 2006
contingencies;
results
higher personnel expenses resulting from the
average tariff adjustment of 11.45%, effective as
general wage agreement approved in July, as
of July 4, 2007;
well as the payment of PLR (Participação nos
4.6% growth in total consumption;
Lucros e Resultados, or Profit Sharing);
lower electricity purchase costs;
rise in the expenses under CCC (Conta de
lower charges for the use of the power grid and
Consumo de Combustível, or Fuel Account) due
the transmission grid; and
to the new quota as of July; and
a drop in operating expenses, mainly selling
lower financial revenues due to the drop in
expenses.
interest rates combined with the accounting of
extraordinary financial revenues in 2005.
70
This happened because of rules for the
compensation of RTE (Recomposição Tarifária
Extraordinária, or Extraordinary Tariff Reset),
determined by Aneel.
It is worth mentioning that the 2005 and 2004
financial statements were adjusted pursuant to CVM
(Comissão de Valores Mobiliários, or Securities and
Exchange Commission) Order n°555 of December
12, 2005, corresponding to the accounting of the
Gross Operating Revenues
expenses deferred with the 2004 debt restructuring.
R$11,350.8 million
Electric power supply
Operating Revenues
The 2006 gross operating revenues totaled
Access to the transmission and distribution system
Other operating revenues
R$11,350.8 million, 1.8% higher than in the
previous year. The better performance reflects
the 11.45% average tariff adjustment and the
5% 2%
4.6% increase in total consumption.
In addition, the Company recorded a sharp
increase in free consumers revenues through the
Tariff for the Use of the Distribution System (Tusd).
Revenues rose from R$434.8 million in 2005 to
93%
R$565.6 million in 2006, a 30.1% increase because
of the rise in the consumption of consumers that
were already free, as well as the migration of 46
consumers to the free market in 2006.
Net Operating Revenues were R$8,354.1
million in 2006 up 0.7% from 2005.
The deductions from gross operating revenues
were 4.9% higher than in 2005, which hampered
Gross Revenues – R$ million
the growth in net operating revenues in 2006.
CAGR = +8.2% p.g.
11,154
11,351
2006
discontinuation of the collection of ECE (Encargo
9,981
expenses (R$100.6 million). On the other hand, the
7,636
expenses (R$263.1 million) and the 4.8% rise in ICMS
8,649
explained by the 54.9% increase in PIS and Cofins
2005
The greater amount of deductions can be primarily
de Energia Emergencial, or Emergency Energy
Charge) and EAEE (Encargo de Aquisição de Energia
2004
greater deductions in 2006 by R$226.8 million.
2003
Energy) in December 2005 contribuited to offset the
2002
Emergencial, or Charge for Acquisition of Emergency
EC1
71
Operating Costs and Expenses
Gross operating costs and expenses of
Operating Expenses
Selling expenses totaled R$169.9 million
R$6,903.9 million were recorded in 2006, a 7.6%
in 2006, a 77.9% slump when compared to
drop in comparison with the previous year.
the previous year. This fall was a result of the
The main reasons for this drop are as follows: (i)
variation in credit provision for doubtful accounts
a R$320.1 million fall in energy purchase costs
(PCLD) – which fell from R$746.4 million
and transmission and distribution charges; and
in 2005 to R$145.4 million the following year.
(ii) a R$599.3 million drop in selling expenses.
This fall is directly related to the full provision of
On the other hand, other operating expenses
R$346.4 million corresponding to credits with the
rose by 31.6%, which affected the operating
Municipal Government of São Paulo (MGSP) and
performance of the Company in 2006.
the provisioning of R$176.9 million for the impact
EC1
of the change in the rules for the compensation of
the Extraordinary Tariff Reset (RTE), retroactive
Operating Costs
Expenses on electric energy purchased
to 2002. Both events happened in 2005.
There was a 29.6% increase in general and
totaled R$3,459.5 million in 2006, a 5.8% fall
administrative expenses, which amounted
when compared with the previous year. This
to R$274.8 million owing to higher personnel
drop is mainly due to the change in the energy
expenses. The general wage agreement, approved
purchase mix with the end of the Initial Contracts
on July 20, 2006, had an impact on this item in
in December 2005. This expense proportionally
that it adjusted wages by 4.0% (retroactive to
increased the purchase of electricity at auctions
June 2006). The payment of the profit sharing
offering lower average tariffs, in spite of the 36.8%
installment in September 2006, corresponding to
increase in the expense on the bilateral contract
the first semester, also played a role.
with AES Tietê.
In addition, the charges for the use of the
Other operating expenses rose by 31.6%
(from R$875.2 million in 2005 to R$1,151.5
transmission and distribution system fell
million in 2006). This increase contributed
by 10.2%, mainly because of the lower CTEEP
inversely to the drop in operating costs and
(Companhia de Transmissão de Energia Elétrica
expenses and resulted from: (i) a 16.3% increase
Paulista) connection charges established by the
in the Fuel Account (CCC, Conta de Consumo
2006 tariff adjustment.
de Combustível) and the 3.9% rise in the
EC1
Energy Development account (CDE, Conta de
Desenvolvimento Energético), a consequence of
the new tariff quotas established by Aneel that
went into effect as of the AES Eletropaulo tariff
adjustment of July 4, 2006; and (ii) the provisions
for civil and labor contingencies, which totaled
R$120.9 million.
EC1
72
Financial Result
Adjusted Ebitda
Considering the Parent Company’s financial
The operating generation of cash measured
statements, net financial result was a R$369.2
by Ebida (earnings before interest, taxes,
million expense in 2006, compared to a net
depreciation and amortization) reached R$1,763.4
financial expense of R$319.4 million in 2005.
million in 2006, a 57.2% increase in relation
The consolidated statements show a net financial
to 2005. This increase reflects the 7.6% fall in
expense of R$342.3 million over the year, also a
operating costs and expenses, as explained above.
higher amount than the R$329.6 million expense
Adjusted Ebitda in 2006 totaled R$2,490.8
recorded in 2005. The consolidated statements
million, in comparison to R$2,134.0 million
reflect the Company’s financial result better
in 2005. This represents a 16.7% increase.
because they annul AES Eletropaulo’s debt
The 2006 adjusted Ebitda considered the
charges of R$1.240.0 million with the subsidiary
following corrections to better reflect the
Metropolitana Overseas II Ltd.
Company’s cash generation:
The lower financial income was the main
reason for the worse financial performance in
2006. The consolidated financial income totaled
Adjusted Ebitda
R$421.2 million, a 39.0% fall when compared to
CAGR = +8.2% p.g.
2005. This result was influenced by the changes
2,491
2,134
in the rules for the Extraordinary Tariff Reset
(RTE) established by Aneel Circular Letter
2.212 of December 20, 2005, which generated
additional financial income of R$193.6 million
2006
for AES Eletropaulo in FY 2005.
2005
1,723
1,472
2003
2004
1,436
2002
+ 16.7%
R$ thousand
2006
2005
1,763.4
1,121.9
FCESP Liability Expense
242.0
241.8
Extraordinary Tariff Reset (RTE)
326.8
334.9
Social Inclusion Program (PIS Account adjustment)
0.0
(72.0)
Municipal Government of São Paulo provision
0.0
330.5
37.7
176.9
120.9
0.0
2,490.8
2,134.0
Ebitda
RTE provision
Provision – Contingencies
Adjusted Ebitda
73
Excluding the additional 2005 income, financial
The Company, supported by CVM Resolution
income fell by 15.2% because of the lower average
Nº 371/00, chose to recognize this amount over
Selic Rate in the year.
a five-year period, in installments of R$486.3
In contrast, financial expenses and
million (one-fifth) each fiscal year, to be booked
monetary and currency variation items
under “Extraordinary Items”. A net income tax
dropped by 25.2% in relation to 2005, mainly
and social contribution expense of R$320.9
because of the lower real-denominated currency
million was recorded in 2006.
variation, which represented a R$247.3 million
It is important to point out that the recognition
expense in 2006, in comparison to a R$530.8
of the actuarial liability with the Pension Fund
million expense in 2005. This performance is
in the balance ended in 2006. Consequently, this
mainly due to the following factors:
expense no longer will be repeated as of 2007,
lower Selic Rate in 2006; and
which will contribute to better results going
compliance with the debt amortization schedule.
forward.
GRI-3.10
Extraordinary Items
EC3
Net Income
AES Eletropaulo posted net income of R$373.4
Discontinuation of the Actuarial Liability
million in 2006, in relation to a R$155.5 million
Recognition
loss in 2005.
In 2002, AES Eletropaulo recognized the R$
It is worth mentioning that the 2005 and
2,431.3 million unrecorded actuarial liability with
2004 financial statements were adjusted pursuant
Fundação CESP, observed on December 31, 2001.
to CVM (Comissão de Valores Mobiliários, or
Securities and Exchange Commission) Order
Nº 555 of December 12, 2005, corresponding
to the accounting of the expenses deferred with
the 2004 debt restructuring.
EC1
With a net income
0f R$373.4 million
in 2006, AES Eletropaulo reversed the loss it had accumulated until the beginning
of the second semester.
74
As a result, the Company managed to absorb
On December 26, 2006, the term of the
the loss accrued in 2005, and it was possible to pay
“Mathematical Reserves” contract with
dividends totaling R$130.4 million (R$3.23/´000
Fundação Cesp, totaling R$2,245.1 million at
preferred shares and R$2,94/’000 common
that date, was extended from 2017 to 2022; and
shares), to be approved by the Board of Directors
Both renegotiated contracts were retroactive to
on April 9, 2007.
January 2006, which meant a R$633 million
saving for the Company up to the end of 2008.
Cash Flow
The full 2006 cash flow is outlined on pages 9
and 10, in the Financial Statements.
The average cost of AES Eletropaulo’s total
debt rose from 88.2% of the CDI in 2005 to
104.3% of the CDI in 2006. This variation is
Debt
Consolidated Net Debt fell by 19.8% when
compared with the situation on December 31, 2005,
due to the reconciled amortization schedule and the
explained by a lower CDI rate. However, in
absolute terms, the full cost of the debt fell from
15.80% p.a. in 2005 to 13.84% p.a. in 2006.
The average maturity of the total debt rose
drop in the Selic Rate. This fall made it possible for
from 3.7 years in 2005 to 5.5 years in 2006,
the Company to report a consolidated net debt of
including the extension of the two debt contracts
R$3,657.6 million and a consolidated gross debt of
with Fundação Cesp.
R$4,829.9 million of on December 31, 2006.
AES Eletropaulo continued its financial
strategy of extending maturity dates and reducing
the average cost of its debt with creditor banks in
2006, which resulted in better credit indicators for
the Company in the year.
AES Eletropaulo made only one bond issue in
Total Debt
IGP – DI
2006, and raised R$300 million (CCBs, or Bank
CDI/Selic
Credit Notes), in April, with an average maturity
Fixed Rate
of 5.9 years and an average rate of CDI + 1.82%.
Libor
The funds were allocated to pay the outstanding
debt of R$234.7 million with creditor banks
1.6%
renegotiated on March 12, 2004.
Debt renegotiation with Fundação Cesp:
11.6%
The term date of the “Debt Confession” contract
with Fundação Cesp, totaling R$522.2 million,
50%
was extended from 2008 to 2022 on September
29, 2006;
36.8%
75
This result allowed a rise in the Standard &
The foreign currency denominated portion of
Poor's and Fitch international scale ratings for
debt fell from 6.0% of the total amount at the end
AES Eletropaulo, from B+ to BB-. Concerning
of 2005 to 1.6% at the end of 2006, which reduced
national scale ratings, the Fitch rating went up
the Company’s foreign exchange exposure. 95.9%
from BBB+ to A, whereas the S&P rating rose from
of this portion is hedged for foreign exchange risk.
BBB+ to A-.
AES Eletropaulo will need no additional lines of
According to AES Eletropaulo’s current debt
credit to honor its obligations in 2007. However, it
profile, 88.2% of its obligations are adjusted
will remain on the watch for good opportunities to
by variable rates, 36.8% of which are corrected
finance investments as part of its financial strategy.
by the Selic rate.
Moreover, it will continue to seek alternatives to
improve the conditions of the issued securities to
reduce costs and extend maturities.
Consolidated Debt
Long-term
Short-term
20%
80%
Financial Hedge
Local currency
Hedge
Foreign Currency
76
62%
83%
94%
0.1%
1.5%
98.54%
2006
17%
2005
2003
2002
54%
35%
3%
2004
42%
4%
1%
5%
Our Shares as an Investment
AES Eletropaulo is a publicly-held corporation
AES Eletropaulo shares are listed on Bovespa’s
whose common and preferred shares are traded
Corporate Sustainability Index (ISE), which
on the São Paulo Stock Exchange (Bovespa)
consists of 43 stocks of 34 companies, which
under ticker symbols ELPL3, ELPL5 and ELPL6.
account for 48.5% of Bovespa’s total market
When it joined Level 2 on the Bovespa Corporate
capitalization. ISE was created to become a
Governance Standards in December 2004,
benchmark for socially responsible investment.
the Company and its controlling shareholders
It includes stock of companies that are selected
committed themselves to following a number
from those whose securities have the highest
of corporate governance practices and granting
liquidity at Bovespa and that meet pre-established
minority shareholders additional rights.
social responsibility and corporate sustainability
This achievement greatly benefits investors
requirements.
because it means better stock pricing, improved
2.6
monitoring of Company business, greater
assurance of shareholder’s rights and lower risk.
77
Shareholding Structure
September 2006
AES Eletropaulo’s capital stock in December
secondary offer of class B preferred shares
2006 totaled R$1,057.6 million and consisted
issued by AES Eletropaulo and controlled by
of 16,651,204,352 common shares (39.8% of the
AES Transgás S.A. (“AES Transgás”) totaling
total) and 25,184,767,324 preferred shares
about R$1.2 billion; and
(60.2% of the total), with a total free float of
Brasiliana merger into AES Transgás.
56.2%. The Company had 51,326 shareholders
October 2006
at the end of the year.
advance payment of the debentures issued by
Company Restructuring
Brasiliana (amounting to about US$607 million)
Brasiliana Energia S.A. (“Brasiliana”),
to BNDES;
an indirect controlling shareholder of
issue of Commercial Papers by Energia Paulista
AES Eletropaulo, conducted a financial and
Participações S.A. (“Energia Paulista”) totaling
shareholding restructuring with a view to
R$800 million as a bridge loan for the later full
strengthening the capital structure of the group
payment of the 3rd issue of Companhia Brasiliana
by reducing its indebtedness and restructuring
de Energia debentures;
its outstanding debt. Furthermore, it intends to
advance payment of the debentures issued by
eliminate inefficiencies arising from the existence
Energia Paulista Participações S.A. (“Energia
of holding companies or intermediaries, some of
Paulista”) and amounting to about R$206
which with overseas headquarters.
million (principal and interest); and
The main restructuring activities in 2006 were:
merger of AES Transgás into Energia Paulista
with the name Companhia Brasiliana de Energia.
Common
%
Preferred
(Class A)
%
Preferred
(Class B)
%
Total
%
12,956,450,380
77.81
0
0.00
0
0.00
12,956,450,380
30.97
Federal Union
3,335,596,142
20.03
64,630
0.01
0
0.00
3,335,660,772
7.97
Cia. Brasiliana
de Energia
0
0.00
0
0.00
1,858,602,977
7.56
1,858,602,977
4.44
BNDES
0
0.00
0
0.00
183,644,102
0.75
183,644,102
0.44
359,157,830
2.16
592,272,636
99.99
22,550,182,979
91.70
23,501,613,445
56.18
16,651,204,352
100.00
592,337,266
100.00 24,592,430,058
100.00
41,835,971,676
100.00
Shareholder
AES ELPA
Others
(Free Float)
Total
78
November 2006
Creation of Class B
Preferred Shares (PNB)
advance payment of the bonds issued by
AES IHB amounting to about US$ 322 million
The General Shareholders’ Meeting of July 11,
(principal and interest).
2006 approved the creation of new Class B
AES Eletropaulo shares (PNBs). The existing
December 2006
preferred shares are to be called Class A (PNAs).
new debenture issue by Companhia Brasiliana de
The PNB holders will have 100% tag along rights,
Energia totaling R$800 million.
and all other statutory rights of the PNAs are
maintained.
2.9
Also approved was the establishment of a 30-day
Next steps:
period for PNA shareholders to convert their shares
The intermediary and non-operating holding
to PNBs one-to-one. The conversion period began on
companies AES Tietê Participações and
the fourth working day after the publication of the
AES Tietê Holdings will be extinguished
Notice To Shareholders. The notice was published as
according to the financial and corporate
soon as CVM allowed AES Eletropaulo to register the
restructuring plan of Brasiliana Energia S.A.
creation of PNBs.
in order to make the whole corporate structure
more efficient.
Simplified Shareholding Structure
(after restructuring)
2.9
AES
BNDES
AES
49.99%
Common
100%
Preferred
50.01%
Common
Cia. Brasiliana
de Energia
98.26%
Common
Minorit.
7.38%
Preferred
1.74%
Common
AES ELPA
77.81%
Common
Minorit.
Federal Union
2.16%
Common
91.89%
Preferred
20.03%
Common
BNDES
0.76%
Preferred
79
As part of the
Company Restructuring
made in 2006, the Secondary Public Offer of Class B preferred shares of
AES Eletropaulo increased the Company’s free float to 56.2%.
Secondary Public Offer of the
Secondary Public Offer of the
Preferred Class B Shares
Preferred Class B Shares
A secondary offer of 15,829,189,000
AES Eletropaulo’s Class A preferred shares
AES Eletropaulo Class B preferred shares (PNBs)
(ELPL5) ended 2006 quoted at R$102.50 per
owned by AES Transgás Empreendimentos S.A.
thousand shares, a 2.5% appreciation over the
was made at a price of R$85.00 per thousand
year. Concerning Class B preferred shares, priced
shares on September 25, 2006. The Company’s
at R$109.00 per thousand shares at the end of the
free float rose to 56.2% after the offer, and
year, appreciation was 28.2% over the secondary
therefore, exceeded Bovespa’s minimum
offer pricing of R$85.00. Since these shares were
requirement for Corporate Governance Level 2,
first offered on August 31, 2006, priced at R$93.6
which is a minimum of 25% of all shares available
per thousand shares, appreciation was 16.5%.
for trading. As a result, the Company fulfilled
The performance of these shares raised
this requirement long before its deadline to do so
AES Eletropaulo’s market capitalization
(December 2007.)
to R$4,560.1 million.
With the funds raised after the full exercise
In 2006, Ibovespa (the São Paulo Stock
of the over-allotment option (greenshoe), the
Exchange Index) rose by 32.9% and IEE (Electric
updated balance of Brasiliana Energia S.A.’s
Energy Index) increased by 40.8%.
debentures with BNDES was paid in advance.
In 2006, the average daily financial trading
volume of AES Eletropaulo’s preferred shares was
R$18.0 million, compared to R$4.2 million in
2005. This substantial increase was mainly due to
the secondary offer of 15.8 billion Class B shares.
80
ELPL5 x Ibovespa x IEE (IBF – 12/29/05)
IEE
Ibovespa
ELPL5
145
+40.8%
+32.9%
135
125
115
105
+2.5%
95
85
Dec - 06
Oct - 06
Aug - 06
Jun - 06
Apr - 06
Feb - 06
Dec - 05
75
ELPL6 x Ibovespa x IEE (IBF – 08/31/06=100)
IEE
Ibovespa
ELPL6
+22.7%
120
+17.9%
110
+16.5%
100
Dec - 06
Nov - 06
Oct - 06
Sep - 06
Aug - 06
90
81
Preferred shares were traded at all Bovespa
sessions, in a total of 75,499 transactions with
9.2 billion shares.
Shareholder Remuneration
The Company reverted the situation of
accumulated losses, of R$262.1 million, as at
December 31, 2005 with the 2006 net income.
The payment of dividends corresponding to
the remaining 2006 net income, after absorbing
accumulated losses, was proposed by the Board
Meeting of March 6, 2007, and approved by the
Shareholders' General Meeting held on April
9, 2007. The amount to be paid as dividends
proposed by the Company’s management
is R$130.4 million.
Proposed Dividends 2006
(R$ million)
Accrued Losses 2005
Reversal of prescribed dividends
3.8
Income in 2006
373.4
Net Income
115.0
Legal Reserve (5%)
(5.8)
Realization of Revaluation Reserve
Dividends
82
(262.1)
21.1
130.4
Strategies and Outlook
The year of 2006 was marked by major
Based on the belief that the basis of sustainable
structural adjustments in the Company, which
development is the continuity of its actions,
included shareholding restructuring, management
AES Eletropaulo will work even more to offer a
restructuring and leadership development.
better service and improve its internal processes.
These adjustments also emphasize work
With the groundwork laid, the Company is now
processes and methods, essential due to the
better structured and equipped to develop new
nature of Company's activity. Also important
projects and, therefore, pursue its goals.
is the dissemination of a comprehensive
AES Eletropaulo also seeks greater synergy
concept of sustainability – economic, social and
with other group companies in Brazil and abroad
environmental – among the employees, as a
in order to strengthen its commitment to keeping
commitment for all Company actions. After this
and improving operating efficiency and making its
period, AES Eletropaulo is now better prepared
actions sustainable and long-lasting. An example
to improve, modernize itself, achieve greater
is the social and environmental assessments,
efficiency and, consequently, better results.
which have begun. A central policy for this issue
will be introduced in 2007.
83
AES Eletropaulo is also planning new
investments for the near future. A thorough
project analysis will be introduced in 2007, which
will mean a new cycle for the Company. This will
certainly bring returns for shareholders.
In 2007, AES Eletropaulo will be one of
the first Brazilian companies to have a second
Tariff Review. Due to this, it has been reviewing
its processes, assessment methods and the
peculiarities of the concession area.
In view of the characteristics of its concession
area – the most developed and densely populated
in the Country – Company growth will not result
from an organic expansion. AES Eletropaulo’s
strategy to develop and increase profitability is
to manage and reduce costs as well as increase
the efficiency, productivity and reliability of the
operating system. This can be achieved with
better logistics and the use of innovative methods,
technological systems and processes.
84
Sustainability Indicators
AES Eletropaulo – base year 2006 – Ibase Matrix
1 – Basis for Calculation
2006 Value (R$ thousand)
2005 Value (R$ thousand)
Net revenues (NR)
8,354,182
8,296,767
Operating result (OR)
1,095,755
505,370
Gross payroll (GP)
1,153,620
1,079,319
2 – Internal Social Indicators
Value (‘000)
% over GP
% over NR
Value (‘000)
% over GP
% over NR
Nutrition
20,158
1.75
0.24
19,916
1.85
0.24
Mandatory payroll taxes
77,828
6.75
0.93
70,716
6.55
0.85
739,965
64.14
8.86
738,538
68.43
8.90
21,399
1.85
0.26
16,891
1.56
0.20
46
0.00
0.00
81
0.01
0.00
3,217
0.28
0.04
2,700
0.25
0.03
0
0.00
0
0.00
0
0.00
1,623
0.14
0.02
1,599
0.15
0.02
542
0.05
0.01
452
0.04
0.01
Profit sharing
31,361
2.72
0.38
34,816
3.23
0.42
Other
19,151
1.66
0.23
18,567
1.72
0.22
915,290
79.34
10.96
904,276
83.78
10.90
Value (‘000)
% over OR
% over NR
Value (‘000)
% over OR
% over NR
Education
3,217
0.29
0.04
3,176
0.63
0.04
Culture
3,422
0.31
0.04
3,107
0.61
0.04
0
0.00
0.00
0
0.00
0.00
Sport
935
0.09
0.01
22
0.00
0.00
Food
1,405
0.13
0.02
1,754
0.35
0.02
Others
8,249
0.75
0.10
12,461
2.47
0.15
18,466
1.69
0.22
21,753
4.30
0.26
Taxes – excluding social charges
2,992,631
273.11
35.82
2,633,509
521.11
31.74
Total – External social indicators
3,011,097
274.80
36.04
2,655,262
525.41
32.00
Value (‘000)
% over OR
% over NR
Value (‘000)
% over OR
% over NR
17
0.00
0.00
1,592
0.32
0.02
Investments in programs
and/or external projects
1,890
0.17
0.02
1,199
0.24
0.01
Total investments in environmental issues
1,907
0.17
0.02
2,791
0.55
0.03
Private pension plan
Healthcare
Occupational Safety
Education
Culture
Training and professional development
Day-care
Total – Internal social indicators
3 – External Social Indicators
Health and sanitation
Total contributions to society
4 – Environmental Indicators
Investments related to
production/operations
As for the determination of “annual
goals” to minimize residues, general
consumption in production/operations
and to enhance efficacy in the use of
natural resources, the Company
( ) has no goals
( ) accomplishes 0 to 50%
( X ) accomplishes 76 to 100%
( ) has no goals
( X ) accomplishes 76 to 100%
85
5 – Employee Indicators
2006
2005
Number of employees at end of period
4,316
4,377
164
224
4,695
4,438
68
111
Number of employees over 45 years old
551
482
Number of women working at the Company
865
895
% of management positions
occupied by women
12.44
22.00
Number of African Brazilians
working at the Company
151
138
% of management positions
occupied by Afro-Brazilians
0.00
0.00
49
42
2006
2007 Goals
73.85%
0
0
0
Number of employees
hired during the period
Number of outsourced workers
Number of trainees
Number of handicapped employees
6 – Material Information as to the
Exercise of Corporate Citizenship
Ratio between lower and
higher Company remuneration
Total number of labor accidents
The social and environmental
projects developed by the
Company were established by:
The safety and health standards
at the workplace were established by
( ) officers
( X ) officers
and mngt
( ) all
employees
( ) officers
( ) officers
and mngt
( X ) officers
and mngt
( ) all
employees
( ) everyone+
CIPA
( ) officers
and mngt
( ) all ( X ) everyone+
employees
CIPA
As to the employees’ union-related freedom,
( ) does not get
right of collective negotiation and internal
involved
representation, the Company:
( ) stimulates
( X ) follows
and follows OIT
OIT rules
rules
( X ) all
employees
( ) will not get ( ) will follow
involved
OIT rules
( X ) will
stimulate and
follow OIT rules
The private pension plan covers:
( ) officers
( ) officers
and mngt
( X ) all
employees
( ) officers
( ) officers
and mngt
( X ) all
employees
The profit sharing plan covers:
( ) officers
( ) officers
and mngt
( X ) all
employees
( ) officers
( ) officers
and mngt
( X ) all
employees
When selecting the suppliers, the same
standards of ethics and social/environmental
responsibility adopted by the Company:
( ) are not
considered
( ) are
recommended
( X ) are
required
( ) will not be
( ) will be
considered recommended
( X ) will be
required
( ) does not get
involved
( ) are
supports
( X ) organizes
and stimulates
( ) will not get
involved
Total number of customers’
complaints and critiques:
at Company
ND
at Procon
135
at Court
12.263
at Company
0
% of complaints and critiques
responded or solved:
at Company
_______%
at Procon
_______%
at Court
_______%
at Company
_______%
As to the participation of employees in
voluntary work projects, the Company:
Total value added to
distribute (R$ thousand):
Added value distribution
7 – Further Information
86
( ) will ( X ) will organize
support
and stimulate
at Procon
0 at Court
at Procon
_______%
0
at Court
_______%
In 2006: R$6,367,163
In 2005: R$5,730,936
63% government 16% employees 2% shareholders
14% third parties 5% retained at the Company
64% government 14% employees 0% shareholders
19% third parties 0% retained at the Company
Added Value Statement
Consolidated
Added Value Statement
1. Revenues
Gross Revenues from the Sale of Energy and Services
Allowance for Bad Debts
Non-operating Revenues (Expenses)
2. Inputs Acquired From Third Parties
Materials
Other Operating Costs
Cost of Energy Bought and Transmission
Third-party Services
Loss on the Sale of Fixed Assets
2006
2005
R$ thousand
%
R$ thousand
%
11,154,632
176
10,397,277
181
11,350,820
179
11,180,335
195
(145,460)
(2)
(747,375)
(13)
(50,728)
(1)
(35,683)
(1)
4,995,086
79
5,121,267
89
24,822
-
41,195
1
309,669
5
121,289
2
4,392,425
69
4,712,538
82
268,170
5
244,485
4
-
-
1,760
0
313,029
5
299,608
5
313,029
5
299,608
5
4. Net Generated Added Value
5,846,517
92
4,976,402
87
5. Added Value Received From
Equity from Affiliates
Financial income
520,646
520,646
8
8
754,534
754,534
13
13
6,367,163
100
5,730,936
100
1,040,698
16
980,683
17
3. Retention
Depreciation and Amortization
6. Added Value to Distribute
7. Added Value Distribution
Employees
Compensation and Social Charges
247,887
4
186,108
3
Management Compensation
5,060
-
4,973
0
Profit Sharing
31,361
-
35,017
1
13
Private Pension Fund
739,965
12
738,538
Others
16,425
-
16,047
0
Taxes
4,079,809
63
3,811,316
67
983,066
15
674,570
12
602,270
9
454,550
8
0
Federal
Cofins
Pis
139,737
2
25,525
INSS
45,697
1
43,555
1
Social Charges – Others
12,179
-
10,519
0
Others (IT, CSLL, CPMF)
183,183
3
140,421
2
State
2,187,690
34
2,087,921
36
ICMS
2,186,054
34
2,086,149
36
1,636
-
1,772
0
16,443
-
15,068
0
1,496
-
1,259
0
13,770
-
12,353
0
Others
Municipal
ISS
IPTU
Others
1,177
-
1,456
0
Regulatory Charges Related to Concession
892,610
14
1,033,757
18
Financing Parties
873,285
14
1,094,470
19
862,922
14
1,084,108
19
10,363
-
10,362
0
373,371
7
(155,533)
(3)
373,371
6
-
-
-
1
(155,533)
(3)
6,367,163
100
5,730,936
100
Interests
Rents
Retained Earnings (Loss)
Accumulated Income
Net Loss
Suplementary information to the Financial Statements, according to Resolution CFC #1.010/04.
87
GRI Index
3.12
AES Eletropaulo has used the guidelines of
The abbreviation “NA” (not applicable) was
Global Reporting Initiative – GRI –G3 (third
used in many indicators in this first edition. In some
generation) for the first time to produce this report.
cases, this should be interpreted as a difficulty in
The application level of the guidelines was “C”,
gathering data and information related to these
which includes the Profile indicators 1.1, 2.1, 2.10,
indicators. The Company is committed to increasing
3.1, 3.8, 3.10, 3.12, 4.1, 4.4, 4.14 and 4.15, besides a
the level of application of the guidelines to “B” in
minimum of ten performance indicators including
the next edition. With this in mind, it will further
at least one Social indicator, one Economic
disseminate the concepts of sustainability among
indicator and one Environmental indicator
its employees and managers, review the current
according to the protocol designed by GRI
programs and invest both in new programs and in
(www.globalreporting.org).
more accurate data collecting systems and processes.
Profile
1. Strategy and Analysis
Chapter/Section
Page
1.1
Statement from the most senior decision-maker of the organization about the relevance of sustainability to
the organization and its strategy.
Message from the CEO
1.2
Description of key impacts, risks, and opportunities.
Environment Context/No Fines; Environmental
Management; Risk Management; 38. Financial
Instruments
17, 65,
FS-67
2. Organizational Profile
Chapter/Section
Page
2.1
Name of the organization.
Profile
2, FS-13
2.2
Primary brands, products, and/or services.
Profile
2
2.3
Operating structure of the organization, including main divisions,
operating unities, subsiaries and joint ventures.
14
2.4
Location of organization’s headquarters.
Corporate Information
94
2.5
Number of countries where the organization operates, and names of countries with either major operations
Profile
or that are specifically relevant to the sustainability issues covered in the report.
8
3
2.6
Nature of ownership and legal form.
Our Shares as an Investment/Shareholding
Structure; Explanatory Notes to Accounting
Statements; 1. Operating Context
2.7
Markets served (including geographic breakdown, sectors served, and types of customers/beneficiaries).
Profile/Operating Activities
2.8
Scale of the reporting organization.
Profile
2, 3
2.9
Significant changes during the reporting period regarding size, structure, or ownership.
Our Shares as an Investment
78
2.10
Awards received in the reporting period.
Health and Safety; Environmental Management/
Actions; Our Shares as an Investment/
Shareholding Restructuring
32, 46
3. Reports parameters
Chapter/Section
Page
3.1
Reporting period (e.g., fiscal/calendar year) for information provided.
94
3.2
Date of most recent previous report (if any).
Methodology; Corporate Information
94
3.3
Reporting cycle (annual, biennial, etc.)
Methodology; Corporate Information
94
3.4
Contact point for questions regarding the report or its contents.
Business Management/Communication;
3.5
Process for defining report content, including: a) Determining materiality; b) Prioritizing topics within the
report; and c) Identifying stakeholders the organization expects to use the report.
Methodology
7
3.6
Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities, joint ventures, suppliers).
Methodology
6
3.7
State any specific limitations on the scope or boundary of the report.
88
77, FS-13
18, 20
43, 94
NA
3.8
Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities
that can significantly affect comparability from period to period and/or between organizations.
NA
3.9
Data measurement techniques and the bases of calculations, including assumptions and techniques
underlying estimations applied to the compilation of the Indicators and other information in the report.
NA
3.10
Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons
for such re-statement (e.g., mergers/acquisitions, change of base years/periods, nature of business,
measurement methods).
Financial Income/
Economic and Financial Performance
3.11
Significant changes from previous reporting periods in the scope, boundary, or measurement methods
applied in the report.
Methodology
3.12
Table identifying the location of the Standard Disclosures in the report.
Table of Contents; GRI-G3 Index
Policy and current practice with regard to seeking external assurance for the report.
Corporate Governance/Audit; Explanatory
Notes; Financial Instruments
3.13
4. Governance, Commitments, and Engagement
Chapter/Section
73,74
6
1, 88
14, FS-75
Page
4.1
Governance structure of the organization, including committees under the highest governance body
responsible for specific tasks, such as setting strategy or organizational oversight.
Corporate Governance/Board of Directors;
Corporate Governance/ Statutory Audit
Committee; Corporate Information/ Board of
Directors/ Statutory Audit Committee
4.2
Indicate whether the Chair of the highest governance body is also an executive officer (and, if so, their
function within the organization’s management and the reasons for this arrangement).
Committee
12, 13
4.3
For organizations that have a unitary board structure, state the number of members of the highest
governance body that are independent and/or non-executive members.
Committee
12, 13
4.4
Mechanisms for shareholders and employees to provide recommendations or direction to the highest
governance body.
Corporate Governance/
4.5
Linkage between compensation for members of the highest governance body, senior managers, and
executives (including departure arrangements), and the organization’s performance (including social and
environmental performance).
4.6
Processes in place for the highest governance body to ensure conflicts of interest are avoided.
4.7
Process for determining the qualifications and expertise of the members of the highest governance body for
guiding the organization’s strategy on economic, environmental, and social topics.
4.8
Process for determining the qualifications and expertise of the members of the highest governance body for
Profile
guiding the organization’s strategy on economic, environmental, and social topics.
3
4.9
Procedures of the highest governance body for overseeing the organization’s identification and management
of economic, environmental, and social performance, including relevant risks and opportunities, and
adherence or compliance with internationally agreed standards, codes of conduct, and principles.
11
4.10
Self-evaluation processes of performance conducted by the highest governance body, especially with regard
to economic environmental, and social performance.
ND
4.11
Explanation of whether and how the precautionary approach or principle is addressed by the organization.
ND
4.12
Externally developed economic, environmental, and social charters,
principles, or other initiatives to which the organization subscribes or endorses.
4.13
Memberships in associations (such as industry associations) and/or national/international advocacy
organizations in which the organization: a) has positions in governance bodies; b) participates in projects or
Sector Environment/No Fines
committees; c) Contributes with funds that exceed basic fee of an associated member; and d) Considers its
memberships as strategical.
17
4.14
List of stakeholder groups engaged by the organization.
Methodology
6
4.15
Base for identification and selection of stakeholders with whom to became engaged.
25
4.16
Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder
group.
Social Management/ Education and Culture;
Social Management/Education and Culture/
Cultural Projects Tables; Social Management/
Education and Culture
57, 58, 59,
60, 61, 62,
63, 64
4.17
Key topics and concerns that have been raised through stakeholder engagement, and how the organization
has responded to those key topics and concerns.
Capital Expenditures/Regularization of illegal
electric connections
26
12, 13, 93
13
ND
11
ND
Corporate Governance/Code of Ethics
Corporate Governance/Sarbanes-Oxley Law
12
Economic Performance Indicators
Aspect: Economic Performance
Essential
EC1
Direct economic value generated and distributed, including revenues, operating costs, employee
compensation, donations and other community investments, retained earnings, and payments to capital
providers and governments.
Essential
EC2
Financial implications and other risks and opportunities for the organization’s activities due to climate change.
Essential
EC3
Coverage of the organization’s defined benefit plan obligations.
Essential
EC4
Significant financial assistance received from government.
Aspect: Market Presence
Essential
EC5
Range of ratios of standard entry level wage compared to local minimum wage at significant locations of
operation.
Chapter/Section
Page
Economic and Financial Performance/Net
Income Explanatory Notes
71, 72, 74,
FS-57, FS-59,
FS-61, FS-63
Economic and Financial Performance/Net
Income Explanatory Notes
71, 72, 74,
FS-57, FS-59
FS-61, FS-63
ND
ND
Chapter/Section
Business Management/Remuneration and
Benefit Policy
Page
39
FS (Financial Statements): This abbreviation represents the Financial Statements page, where the G3 indicators can be found.
NA (Non-applicable)
ND (Non-available)
89
Essential
EC6
Relationship with Suppliers; 4.
Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation. Summary of the Main Accounting Practices; 18.
Suppliers
Essential
EC7
Procedures for local hiring and proportion of senior management hired from the local community at
locations of significant operation.
Aspect: Indirect Economic Impacts
Essential
EC8
Development and impact of infrastructure investments and services provided primarily for public benefit
through commercial, in-kind, or pro bono engagement.
Additional
EC9
Understanding and describing significant indirect economic impacts, including the extent of impacts.
44, FS-16
FS-38
ND
Chapter/Section
Page
25
ND
Environmental Performance Indicators
Aspect: Materials
Chapter/Section
Page
Essential
EN1
Materials used by weight or volume.
ND
Essential
EN2
Percentage of materials used that are recycled input materials.
ND
Aspect: Energy
Essential
Essential
EN3
EN4
Chapter/Section
Page
Direct energy consumption by primary energy source.
Environmental Management/Energy
Consumption
52
Indirect energy consumption by primary source.
Environmental Management/Energy
Consumption
52
26, 30
26, 30
Additional
EN5
Energy saved due to conservation and efficiency improvements.
Capital Expenditures/Environmental
Management
Additional
EN6
Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in
energy requirements as a result of these initiatives.
Capital Expenditures/Environmental
Management
Additional
EN7
Initiatives to reduce indirect energy consumption and reductions achieved.
Aspect: Water
ND
Chapter/Section
Page
Essential
EN8
Total water withdrawal by source.
53
Additional
EN9
Water sources significantly affected by withdrawal of water.
NA
Additional
EN10
Percentage and total volume of water recycled and reused.
ND
Aspect: Biodiversity
Chapter/Section
Page
Essential
EN11
Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high
biodiversity value outside protected areas.
53
Essential
EN12
Description of significant impacts of activities, products, and services on biodiversity in protected areas and
areas of high biodiversity value outside protected areas.
53
Additional
EN13
Habitats protected or restored.
ND
Additional
EN14
Strategies, current actions, and future plans for managing impacts on biodiversity.
ND
EN15
Number of IUCN Red List species and national conservation list species with habitats in areas affected by
operations, by level of extinction risk.
NA
Additional
Aspect: Emissions, Effluents, and Waste
Chapter/Section
Page
Essential
EN16
Total direct and indirect greenhouse gas emissions by weight.
52
Essential
EN17
Other significant indirect greenhouse gas emissions by weight.
52, 53
Additional
EN18
Initiatives to reduce greenhouse gas emissions and reductions achieved.
47
Essential
EN19
Emissions of ozone-depleting substances by weight.
52
Essential
EN20
NO2 SO4 and other significant air emissions by type and weight.
52, 53
Essential
EN21
Total water discharge by quality and destination.
49
Essential
EN22
Total weight of waste by type and disposal method.
49
Essential
EN23
Total volume and number of significant overflows.
53
Additional
EN24
Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the
Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally.
NA
Additional
EN25
Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly
affected by the reporting organization’s discharges of water and runoff.
NA
Aspect: Products and Services
Chapter/Section
Page
Essential
EN26
Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation.
46, 47
Essential
EN27
Percentage of products sold and their packaging materials that are reclaimed by category.
90
NA
Aspect: Compliance
Essential
EN28
Chapter/Section
Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with
environmental laws and regulations.
Aspect: Transport
Additional
EN29
Chapter/Section
Significant environmental impacts of transporting products and other goods and materials used for the
organization’s operations, and transporting members of the workforce.
Aspect: Overall
Additional
EN30
Chapter/Section
Total environmental protection expenditures and investments by type.
Page
53, FS-50
Page
52
Page
53
Labor Practices and Decent Work Performance Indicators
Aspect: Employment
Chapter/Section
Essential
LA1
Total workforce by employment type, employment contract, and region.
Business Management/
Relationship with Internal Stakeholders
37, 38, 39,
40, 41
Essential
LA2
Total number and rate of employee turnover by age group, gender, and region.
37, 38, 39,
40, 41
Additional
LA3
Benefits provided to full-time employees that are not provided to temporary or part-time employees, by
major operations.
37, 38, 39,
40, 41
Aspect: Labor/Management Relations
Chapter/Section
Essential
Essential
LA4
Percentage of employees covered by collective bargaining agreements.
Business Management/Remuneration and
Benefit Policy
LA5
Minimum notice period(s) regarding operational changes, including whether it is specified in collective
agreements.
Aspect: Occupational Health and Safety
Chapter/Section
Page
Page
39
37, 38, 39,
40, 41
Page
Additional
LA6
Percentage of total workforce represented in formal joint management–worker health and safety
committees that help monitor and advise on occupational health and safety programs.
Essential
LA7
Rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities by
region.
Business Management
33
Essential
LA8
Education, training, counseling, prevention, and risk-control programs in place to assist workforce
members, their families, or community members regarding serious diseases.
Business Management
33, 35, 37
Additional
LA9
Health and safety topics covered in formal agreements with trade unions.
ND
ND
Aspect: Training and Education
Chapter/Section
Essential
LA10
Average hours of training per year per employee by employee category.
Business Management
Additional
LA11
Programs for skills management and lifelong learning that support the continued employability of
employees and assist them in managing career endings.
Health and Safety/Business Management
Additional
LA12
Percentage of employees receiving regular performance and career development reviews.
Aspect: Diversity and Equal Opportunity
Essential
LA13
Composition of governance bodies and breakdown of employees per category according to gender, age
group, minority group membership, and other indicators of diversity.
Essential
LA14
Ratio of basic salary of men to women by employee category.
Page
37
33, 37
ND
Chapter/Section
Page
Business Management
37, 38, 39,
40, 41
Business Management
37, 38, 39,
40, 41
Human Rights Performance Indicators
Aspect: Investment and Procurement Practices
Chapter/Section
Page
Essential
HR1
Percentage and total number of significant investment agreements that include human rights clauses or that
have undergone human rights screening.
Essential
HR2
Percentage of significant suppliers and contractors that have undergone screening on human rights and
actions taken.
ND
Additional
HR3
Total hours of employee training on policies and procedures concerning aspects of human rights that are
relevant to operations, including the percentage of employees trained.
ND
Aspect: Non-discrimination
Essential
HR4
Total number of incidents of discrimination and actions taken.
Aspect: Freedom Of Association and Collective Bargaining
Essential
HR5
HR6
Chapter/Section
Page
NA
Chapter/Section
Operations identified as having significant risk for incidents of child labor, and measures taken to
contribute to the elimination of child labor.
Page
ND
Operations identified in which the right to exercise freedom of association and collective bargaining may be
at significant risk, and actions taken to support these rights.
Aspect: Child Labor
Essential
Chapter/Section
ND
Business Management
Page
44
NA (Non-applicable)
ND (Non-available)
91
Aspect: Forced And Compulsory Labor
Essential
HR7
Aspect: Security Practices
Additional
HR8
HR9
Chapter/Section
Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of
human rights that are relevant to operations.
Aspect: Indigenous Rights
Additional
Chapter/Section
Operations identified as having significant risk for incidents of forced or compulsory labor, and measures to
Business Management
contribute to the elimination of forced or compulsory labor.
Page
44
Page
ND
Chapter/Section
Total number of incidents of violations involving rights of indigenous people and actions taken.
Page
ND
Society Performance Indicators
Aspect: Community
Essential
SO1
Chapter/Section
Nature, scope, and effectiveness of any programs and practices that assess and manage the impacts of
operations on communities, including entering, operating, and exiting.
Aspect: Corruption
Page
ND
Chapter/Section
Page
Essential
SO2
Percentage and total number of business units analyzed for risks related to corruption.
ND
Essential
SO3
Percentage of employees trained in organization’s anti-corruption policies and procedures.
ND
Essential
SO4
Actions taken in response to incidents of corruption.
ND
Aspect: Public Policy
Essential
Additional
Public policy positions and participation in public policy development and lobbying.
ND
SO6
Total value of financial and in-kind contributions to political parties, politicians, and related institutions by
country.
ND
SO7
SO8
Chapter/Section
Total number of legal actions for anti-competitive behavior, anti-trust, and monopoly practices and their
outcomes.
Aspect: Compliance
Essential
Page
SO5
Aspect: Anti-competitive Behavior
Additional
Chapter/Section
Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with
laws and regulations.
Page
ND
Chapter/Section
Page
Explanatory Notes/
23. Provisions for Litigations and Contingencies
FS-50
Chapter/Section
Page
Capital Expenditures/New Technologies
29,30
Product Responsibility Performance Indicators
Aspect: Customer Health and Safety
Essential
PR1
Life cycle stages in which health and safety impacts of products and services are assessed for improvement,
and percentage of significant products and services categories subject to such procedures.
Additional
PR2
Total number of incidents of non-compliance with regulations and voluntary codes concerning health and
safety impacts of products and services during their life cycle, by type of outcomes.
Aspect: Product and Service Labeling
ND
Chapter/Section
Page
Essential
PR3
Type of product and service information required by procedures, and percentage of significant products and
services subject to such information requirements.
ND
Additional
PR4
Total number of incidents of non-compliance with regulations and voluntary codes concerning product and
service information and labeling, by type of outcomes.
ND
Additional
PR5
Practices related to customer satisfaction, including results of surveys measuring customer satisfaction.
Aspect: Marketing Communications
24, 25
Chapter/Section
Page
Essential
PR6
Programs for adherence to laws, standards, and voluntary codes related to marketing communications,
including advertising, promotion, and sponsorship.
ND
Additional
PR7
Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing
communications, including advertising, promotion, and sponsorship by type of outcomes.
ND
Aspect: Customer Privacy
Additional
PR8
Aspect: Compliance
Essential
PR9
Monetary value of significant fines for non-compliance with laws and regulations concerning the provision
and use of products and services.
Page
NA
Chapter/Section
NA (Non-applicable)
ND (Non-available)
92
Chapter/Section
Total number of substantiated complaints regarding breaches of customer privacy and losses of customer
data.
Sector Environment; Explanatory Notes
Provisions for Litigations and Contingencies
Page
17, FS-50
Board of Directors
Board of Executive Officers
Chairman of the Board
Chief Executive Officer Eduardo José Bernini
Andrés Ricardo Gluski Weilert
Chief Operation Officer Charles Lenzi
Finance & Investor Relations VP Britaldo
Effective Members
Pedrosa Soares
Eduardo José Bernini
Legal Affairs VP Pedro de Freitas
Britaldo Pedrosa Soares
Almeida Bueno Vieira
Eduardo Daniel Dutrey
Regulatory Affairs VP Carlos
Jeffery Atwood Safford
Augusto Leite Brandão
Lucio da Silva Santos
Communication & Social
Vito Joseph Mandilovich
Responsibility VP Maria Angela Jabur
Helena Kerr do Amaral
Corporate Governance VP Mauricio Vargas
Eduardo de V. C. Annunciato
Shared Services VP Ivar Pettersson
Pedro Roberto Cauvilla
Environment Management & Carbon
Peter Greiner
Credit Director Demóstenes
Barbosa da Silva
Substitute Members
Distribution VP Cyro Vicente Boccuzzi
Antonio Carlos de Oliveira
Commercial VP
Marcelo de Carvalho Lopes
Gobbi Lima
Silvestre Rabello de Aguiar Junior
Human Resources VP Manuel Paulo Martins
Sérgio Canuto da Silva
Business Development VP Jeffery A. Safford
Ricardo A.
Management & Control Director Victor Kodja
Safety, Health and Environment
Effective Members
Director Sean Mederos
Lidiane Delesderreier Gonçalves
General Services & Corporate Safety
Renato Francisco Martins
Director Maria do Carmo Marini
Ricardo Berer
4.1
Paulo José dos Reis Souza
Márcio Luciano Mancini
Alternate Members
Alexandre Porciúncula Gomes Pereira
Eduardo Klingelhoefer de Sá
Luciano Siani Pires
Fernando José Alves dos Santos
93
Headquarters
General information
Av. Lourenço Marques, 158
This Sustainability Report collects the actions and
CEP 04547-100 Vila Olímpia
programs undertaken by AES Eletropaulo between
São Paulo SP Brazil
January 1st and December 31, 2006.
Tel.: (55 11) 2195 2021
Fax: (55 11) 2195 2269
The present edition substitutes the previous one,
Site: www.eletropaulo.com.br
published in 2006, with information relative to
Corporate Tax Payer Enrollment Number
the year of 2005 and maintains the annual cycle of
nº 61.695.227/0001-93
the Company’s issuance of reports.
State Registration Number nº 35.300.050.274
This publication has been developed for the
2.4
electronic media and it is available at
Investor Relations
Finance & Investor
Relations VP
Britaldo Soares
Investor Relations Director Clarice Assis
E-mail: [email protected]
Book-Entry Share System
Banco Itaú S.A.
Shareholder Service Office
Centro Empresarial Itaúsa
Av. Eng. Armando de Arruda Pereira, 707
Torre Eudoro Villela – 9º andar
Tel.: (55 11) 5029 1910
Independent Auditors
Ernst &Young Auditores Independentes
Secutiries Exchange
Bolsa de Valores de São Paulo (Bovespa)
Ticker symbols: ELPL3 (ON shares), ELPL5
and ELPL6 (PN shares, classes A and B)
Information Sources
Diário Oficial do Estado de São Paulo
(São Paulo State Register)
Valor Econômico
www.eletropaulo.com.br/ri
94
3.1
94
2003
19,114
98
2004
22,351
98
2005
21,753
1,490
1,606
1,677
1,896
1,936
2.1
16.0
10.0
12.0
22.0
12.4
-10.4 p.p.
8,354
8,297
7,394
6,432
5,781
2006
2005
2004
2003
2002
1,936.0
1,896.0
1,677.0
1,606.0
1,490.0
2.1
1.5
2006
114
2002
15,812
18,466
-18.8
2005
5.52
21,753
6.8
2005
6.4
2004
6.9
Responsibility VP
Global RI
Working Team
TheMediaGroup
BSD Brasil
Graphic Design
TheMediaGroup
[email protected]
Photography
Investor Relations
AES Collection
Daniel Rosa
[email protected]
22,351
8.7
2003
-13.5
19,114
7.87
2002
9.1
15,812
8.9
2006
8.2
[email protected]
5.5
11.1
2006
0.13
3,096
2004
32,668
4,410
7,408
1,167
2004
697
697
2004
2005
2.06
3,046
2003
32,774
4,006
8,181
1,262
2003
864
864
2003
2006
2003
103
5.1
2006 Chg% 06/05
18,466
-15.1
2002
+2.5
+16.5
8.92
4,560
9.0
2006 Chg% 06/05
31,656
0.1
4,316
-1.4
7,335
1.5
1,267
4.7
2006 Chg% 06/05
17
-98.9
1,890
57.6
2006 Chg% 06/05
5.0%
5.3
-20.82
1,088
2002
32,451
3,881
8,362
1,292
2002
218
218
2002
+38.9
-3.72
4,184
2005
31,634
4,377
7,227
1,210
2005
1,592
1,199
2005
63.0%
2005
+35.1
16.0%
3.0
+1.6
Credits
2.0%
2004
+180.0
14.0%
5.1
-66.7
11,351
1.8
8,354
0.7
6,904
-7.6
1,450
75.8
1,763
57.1
2,491
16.7
-369
15.7
373
NA
2006 Chg% 06/05
21.1
7.6 p.p.
29.8
4.1 p.p.
4.5
NA
2006 Chg% 06/05
12,451
0.6
2,196
12.3
4,830
-4.8
1.6
4.4 p.p.
3,658
-19.8
1.7
-26.1
1.5
-28.6
378
-6.4
2006 Chg% 06/05
2004
11,154
8,297
7,471
825
1,122
2,134
-319
-156
2005
13.5
25.7
NA
2005
12,372
1,955
5,075
6.0
4,562
2.3
2.1
404
2005
2005
3.3
9,981
7,394
6,346
1,048
1,317
1,718
-594
-28
2004
17.8
23.2
NA
2004
12,821
2,198
5,284
17.0
5,091
2.3
3.0
330
2004
2006 Chg% 06/05
2003
8,649
6,432
5,637
795
1,060
1,472
24
86
2003
16.5
22.9
1.34
2003
12,724
2,193
5,278
38.0
4,829
2.2
3.3
218
2003
5.1
7,636
5,781
5,184
598
849
1,436
-1,394
-871
2002
14.7
24.8
NA
2002
12,952
2,106
5,902
47.0
5,610
2.7
3.9
180
2002
2003
2005
Shareholders
3.9
2004
2003
Payroll
5.0
2002
Government 2002
(R$ million)
Ebitda
Adjusted Ebitda*
Net income/loss
Margins (%)
Ebitda margin
Net margin
Fixed assets
Gross debt
Net debt
PN
PNA
PNB
Market (GWh)
Number of employees
Quality Indicators
Social Indicators
2004
Sustainability
Report
2006
Presentation
Enjoy your reading!

Sustainability Report

Transcription

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