About Companhia Paranaense de Energia - COPEL

Companhia Paranaense de Energia - COPEL engages in the generation, transmission, distribution, and sale of electricity mainly in the Brazilian state of Paraná, pursuant to concessions granted by ANEEL (the Brazilian Electricity Regulatory Agency, or the Agência Nacional de Energia Eletrica), the Brazilian regulatory agency for the electricity sector. While the company’s activities are more concentrated in the Brazilian state of Paraná, it also operates in ten different Brazilian states through its generation and transmission businesses. As of December 31, 2022, the company generated electricity from 18 hydroelectric plants, 34 wind plants and one thermoelectric plant, for a total installed capacity of 5,758 megawatt (MW), of which approximately 99.7% was derived from renewable sources. Including the installed capacity of generation companies in which the company has an equity interest, its total installed capacity was 6,705 MW. On January 30, 2023, the company completed the acquisition of the Aventura and Santa Rosa & Mundo Novo Wind Complexes, which increased its total installed capacity to 6,966 MW. The company’s electric power business is subject to comprehensive regulation by ANEEL. The company holds concessions to distribute electricity in 394 of the 399 municipalities in the state of Paraná and in the municipality of Porto União in the state of Santa Catarina. As of December 31, 2022, the company owned and operated 3,705 kilometer (km) of transmission lines and 208,133 km of distribution lines, constituting one of the largest distribution grids in Brazil. The distribution of electricity supply in 2022 by consumption class, including free customers, such as 38.7% was to industrial customers; 26.0% was to residential customers; 19.8% was to commercial customers; and 15.5% was to rural and other customers. The company’s generation business sells energy to its distribution business only through auctions in the regulated market. Moreover, the company’s distribution business, like other certain Brazilian distribution companies, is also required to purchase energy from the hydroelectric facility of Itaipu, in an amount determined by the Brazilian government based on the company’s proportionate share in the Brazilian electricity market. Generation As of December 31, 2022, the total installed capacity of all the generation assets in which the company held equity or the rights under concessions was 6,706 MW. Considering only the entities that the company operates (solely or under consortium), including 100% of the energy produced by those in which it holds a 100.0% shareholding stake and 51.0% and 30.0% of the energy generated by Mauá and Baixo Iguaçu Hydroelectric Plants, respectively (corresponding to the interest it holds in each of these assets), it operated and sold energy through 20 hydroelectric plants, 34 wind plants, and one thermoelectric plant, with a total installed capacity of 6,047 MW. The company’s assured energy totaled 2,726 average MW in 2022. The company generated 25,299 gigawatt hours (GWh) in 2022. The generation of electrical energy at the company’s power plants is supervised, coordinated, and operated by its Generation and Transmission Operation Center in the city of Curitiba. This operation center is responsible for coordinating the operations related to major part of the company’s total installed capacity, including some of the plants in which the company holds only partial ownership interests. Hydroelectric Generation Facilities Governador Bento Munhoz da Rocha Netto (HPP (Hydroelectric Power Plant) Foz do Areia): The HPP Foz do Areia is located on the Iguaçu River, approximately 350 kilometers southwest of the city of Curitiba. The concession of this plant, originally granted to Copel GeT under the terms of Concession Agreement No. 045/1999, is set to expire on December 21, 2024. After that, Copel Get could request the renewal of the concession for 30 years, either through the amendment of certain concession terms and inclusion under the quota regime (Law No. 12,783/2013); or by means of the privatization of the concessionaire, through a bidding process for the sale of the concessionaire's shareholding control, including by means of a public offering of shares, within 12 months from the end of the concession term (Federal Decree No. 9,271/2018, amended by Federal Decree No. 10,893/2021 and by Federal Decree No. 11,307/2022). On August 12, 2022, the Ministry of Mines and Energy published Ordinance No. 1,544/2022, which changed the Assured Energy for HPP Foz do Areia to 571.7 average MW, from the date of the new concession agreement. On October 19, 2022, the Ministry of Mines and Energy published Ordinance No 02/2022, which established the minimum award bonus for the HPP Foz do Areia; On October 30, 2022, the Ministry of Mines and Energy published Ordinance No. 698/2022, establishing certain additional conditions for the renewal of the concession and requiring that SPC FDA prepare certain technical and economic feasibility studies to identify the optimum operation for HPP Foz do Areia, within 36 months from the date of the concession agreement, and to implement, if economically feasible, such optimum operation within 96 months from the date of the concession agreement; On December 23, 2022, Decree No. 9,271 was amended by Decree No. 11,307, to also enable the renewal of the concession for 30 years by the sale of corporate control through a public offering of shares. This alternative is in line with the intention of the controlling shareholder to transform the company into a company with dispersed capital and without a controlling shareholder (Material Fact 06/2022), and with the carrying out of studies for the full renewal of the concession of its plants, with the maintenance of 100% of participation, including eventual public offer of primary distribution of its shares and/or ADRs aiming at the payment of the grant bonus (Material Fact 07/2022); If the dispersion of the company’s corporate capital is not implemented, the alternative of alienating FDA control will be once again considered; and On February 15, 2023, the TCU deliberated on the analysis of the technical, economic-financial and environmental feasibility studies for the privatization of the Governador Bento Munhoz da Rocha Netto power plant, and decided to inform the MME and ANEEL that there are no obstacles to the continuity of the bidding process. Governador Ney Aminthas de Barros Braga (HPP Segredo): The HPP Segredo is located on the Iguaçu River, approximately 370 kilometers southwest of the city of Curitiba. Governador Jose Richa (HPP Salto Caxias): The HPP Salto Caxias is located on the Iguaçu River, approximately 600 kilometers southwest of the city of Curitiba. Governador Pedro Viriato Parigot de Souza (HPP Capivari Cachoeira): The HPP Capivari Cachoeira is the largest underground hydroelectric plant in Southern Brazil. The reservoir is located on the Capivari River, approximately 50 kilometers north of the city of Curitiba; and the power station is located on the Cachoeira River, approximately 15 kilometers from the reservoir. The HPP Capivari Cachoeira has 260.0MW of installed capacity and assured energy of 954.8 GWh/year. Mauá: The Jayme Canet Júnior Hydroelectric Power Plant (HPP Mauá) is located on the Tibagi River, in the state of Paraná. It was constructed between 2008 and 2012 by Consórcio Energetico Cruzeiro do Sul, in which the company holds a 51.0% interest and CGT Eletrosul holds the remaining 49.0%. The facility is located approximately 250 kilometers from Curitiba, in the municipality of Telêmaco Borba. Colíder: HPP Colíder has an installed capacity of 300.0 MW and it is located on the Teles Pires River, in the state of Mato Grosso, between the municipalities of Nova Canaã do Norte and Itaúba, with the municipalities of Colíder and Cláudia are also affected by the reservoir. The construction of the plant began in 2011 and the work was totally concluded in 2019. The first Generating Unit entered commercial operation on March 9, 2019 and the last unit started operating on December 21, 2019. Baixo Iguaçu: HPP Baixo Iguaçu has an installed capacity of 350.2 MW and is located on the Iguaçu River, in the municipalities of Capanema, Capitão Leonidas Marques, Planalto, Realeza and Nova Prata do Iguaçu, State of Paraná. Baixo Iguaçu HPP is the last large energy project planned for the main Iguaçu and it is located around 30 km downstream from the HPP Salto Caxias. It was constructed by a consortium in which Copel GeT holds a 30% interest and Geração Ceu Azul S.A. holds the remaining 70.0%. This power plant became fully operational on April 10, 2019. In addition to the company’s generation facilities, it has ownership interests in several other hydroelectric generation companies, such as: Bela Vista: The SHP Bela Vista has 29.8 MW of installed capacity and 18.6 average MW of Assured Energy and is under construction in the Chopim river, in the São João and Verê municipalities, located in the southwest of the state of Paraná. The energy sales agreement will be effective as of January 1, 2024, for a 30-year term and will be subject to an annual adjustment by the IPCA (Índice Nacional de Preços ao Consumidor Amplo). The construction of this unit started in the first half of 2019 and the third power generation unit began operations on August 12, 2021, totaling 29.3 MW in commercial operation (corresponding to 98.3% of the plant’s total capacity). The remaining unit with complementary capacity of 0.5 MW is expected to be fully implemented in 2023. The company was able to achieve the commercial operation of the project almost two and a half years earlier than contemplated under the contracted supply term, which will allow all the energy produced by SHP (Small Hydroelectric Plant) Bela Vista until December 2023 to be sold in the Free Market (ACL). Elejor Facility: The Elejor Facility consists of the Santa Clara and Fundão Hydroelectric Power Plants, both of which are located on the Jordão River in the state of Paraná. The aggregate total installed capacity of the units is 246.41 MW, which includes two smaller hydroelectric generation units installed in the same location. Elejor signed a concession agreement with a term of 35 years for the Santa Clara and Fundão plants in October 2001. As of December 31, 2022, the company owned 70.0% of the common shares of Centrais Eletricas do Rio Jordão S.A. (Elejor), and Paineira Participações owns the remaining 30.0%. The company had a power purchase agreement with Elejor, which provides that the company will purchase all of the energy produced by the Santa Clara and Fundão facilities at a set rate until April 2019, to be adjusted annually in accordance with the General Market Price inflation index (IGP-M Index). Dona Francisca: The company owns 23.03% of the common shares of Dona Francisca Energetica S.A. (DFESA). The other shareholders are Gerdau S.A. with a 51.82% interest, Celesc S.A. with a 23.03% interest, and Statkraft S.A. with a 2.12% interest. DFESA Hydroelectric Power Plant is located on the Jacuí River in the state of Rio Grande do Sul. In April 2015, the company signed a new ten year power purchase agreement with DFESA under which it purchases 23.03% of DFESA’s assured energy (proportional to its stake). SHP Arturo Andreoli (‘Foz do Chopim’ Hydroelectric Plant): The Foz do Chopim Hydroelectric Plant is located on the Chopim River in the state of Paraná. The company owns 35.8% of the common shares of Foz do Chopim Energetica Ltda., the entity that owns the Foz do Chopim Hydroelectric Plant. Silea Participações Ltda. owns the remaining 64.2%. The operation and maintenance of Foz do Chopim Hydroelectric Plant is performed by Copel Geração e Transmissão S.A. Foz do Chopim Energetica Ltda. also had the authorization to operate Bela Vista SHP, a hydroelectric power plant that is located on the same river and has similar capacity, which was transferred to Bela Vista Geração de Energia S.A. (Bela Vista Geração), through the ANEEL’s Authorizing Resolution no. 7,802/2019. Wind Farm Generation Facilities São Bento Energia: In February 2015, the four wind farms (Boa Vista, Olho d’Água, São Bento do Norte and Farol), which are part of the São Bento Wind Farm Complex, located in the state of Rio Grande do Norte, began operations. With an installed capacity of 94 MW and assured energy of 38.1 average MW. The energy generated by these wind farms is sold through 20-year term contracts. Copel Brisa Potiguar Wind Complex: In September 2015, the company concluded the installation of the Brisa Potiguar Wind Complex with an installed capacity 183.6 MW and assured energy of 89.4 average MW. The energy to be generated was sold through 20-year term contracts with payments beginning in April 2015. Voltália São Miguel do Gostoso I: In June 2014, the company acquired a 49.0% interest in the São Miguel do Gostoso I Wind Farm Complex, in the State of Rio Grande do Norte. The São Miguel do Gostoso wind farm complex has 108.0 MW of installed capacity and Assured Energy of 57.1 average MW. Cutia: Cutia Empreendimentos Eólicos, which is the company’s largest wind farm business, is divided into two large complexes totaling 312.9 MW of installed capacity, such as Cutia Complex, composed of seven wind farms (Guajiru, Jangada, Potiguar, Cutia, Maria Helena, Esperança do Nordeste and Paraíso dos Ventos do Nordeste), with a total installed capacity of 180.6 MW, 71.4 average MW of assured energy and located in the state of Rio Grande do Norte; and Bento Miguel Complex, composed of six wind farms (São Bento do Norte I, São Bento do Norte II, São Bento do Norte III, São Miguel I, São Miguel II and São Miguel III) with 132.3 MW of total installed capacity, 58.7 average MW of assured energy and located in the state of Rio Grande do Norte, in the same region of other wind farm complexes that belong to the company. Vilas Complex: In November 2021, the company acquired 100% of the Vilas Complex, located in the state of Rio Grande do Norte, from Voltalia Energia do Brasil Ltda (Voltalia). The Vilas Complex has 186.7 MW of installed capacity and 98.6 average MWm of assured energy. The energy contracts are valid for 20 years. Jandaíra Complex: In November 2022, the four wind farms (Jandaíra I, Jandaíra II, Jandaíra III and Jandaíra IV), located in the state of Rio Grande do Norte, with an installed capacity of 90.09 MW and Assured Energy of 46.2 average MW, began operations. The energy generated by these wind farms is sold through 20-year term contracts. Aventura Complex: In January 2023, the company acquired 100% of the Aventura Complex, located in the state of Rio Grande do Norte, from EDP Renováveis S.A. (EDPR). The Aventura Complex has 105 MW of installed capacity and 65 average MWm of Assured Energy. The energy contracts are valid for 20 years. Santa Rosa e Mundo Novo Complex: In January 2023, the company acquired 100% of the Santa Rosa e Mundo Novo Complex, located in the state of Rio Grande do Norte, from EDP Renováveis S.A. (EDPR). The Santa Rosa e Mundo Novo Complex has 155.4 MW of installed capacity and 92.8 average MWm of assured energy. The energy contracts are valid for 20 years. Thermoelectric Generation Facilities Araucária: The company has an 81.2% interest in UEG Araucária Ltda., which owns the Araucária Thermoeletric Plant, a combined cycle natural gas thermoelectric plant, one of the most efficient in Brazil, with 484.2 MW of installed capacity, located in the state of Paraná. UEG Araucária Ltda. has a gas supply contract with Petróleo Brasileiro S.A - Petrobras, valid until December 31, 2023, which provides for the delivery of up to 2,150,000 cubic meters of natural gas per day, without take-or-pay clauses. As a result, TPP Araucária will remain available to the National Interconnected System – SIN and, therefore, may be dispatched at the discretion of ONS. Figueira: The Figueira plant is located in the city of Figueira, in the northeast of the state of Paraná (where the main coal basin of Paraná is located). The plant now has the installed capacity of 20.0 MW with one generating unit and the assured energy of 17.7 average MW. Expansion and Maintenance of Generating Capacity Wind Farm Projects In January 2023, the company acquired wind complexes, the Santa Rosa & Mundo Novo (SRMN) and Aventura wind complexes, previously owned by EDP Renováveis Brasil S/A. and totaling 260.4 MW of installed capacity. The acquisition is part of the company’s strategy for growth in renewable energy, expands the diversification of the generation portfolio and is fully in line with its investment policy. Development Projects The company is involved in various initiatives to study the technical, economic and environmental feasibility of certain hydroelectric, wind, solar photovoltaic and thermoelectric generation projects. The company is also a member of Consortium Geração Luz Paranaense – CGLP, which was granted with exploration rights related to the following projects: SHP Foz do Curucaca, SHP Salto Alemã, SHP Alto Chopim, and SHP Rancho Grande. After obtaining the applicable authorization from ANEEL and evaluating the hydraulic potential of each project, the consortium decided to carry out the studies only with respect to SHP Salto Alemã and SHP Foz do Curucaca and to return the exploration rights for SHP Alto Chopim and SHP Rancho Grande projects to ANEEL. The basic designs of SHP Salto Alemã and of SHP Foz do Curucaca had already been approved by ANEEL and the environmental studies related to this project were registered in the competent entity (IAT – Instituto Água e Terra do Paraná or IAT) for analysis. Since 2018, the company has held the rights of the HPP Salto Grande, located in the Chopim River in the state of Paraná. The environmental studies related to this project were registered with IAT for analysis in February 2020 and the basic design was approved by ANEEL in November 2020. The company is advancing in the development of pipeline in renewable projects, with emphasis on hydraulic, wind, and solar projects. The renewable projects developed will focus on free market, especially the new costumers arising from the opening of the market. The company is also looking for the energy auctions planned for 2023 in Brazil, it intends to bid for concessions to construct and operate new hydroelectric and solar photovoltaic plants or wind farms in power auctions in the regulated market for new generation projects. The company will also conduct studies of new hydroelectric power plants. For instance, the company has partnered with BE - Empresa de Estudos Energeticos S.A., Minas PCH S.A. and SILEA Participações Ltda. to develop studies in the lower region of the Chopim River, which may lead to the development of another four hydroelectric projects. The company is also looking at opportunities to acquire greenfield and brownfield wind and solar energy projects. The company expects to conduct new studies of wind and solar energy projects in Brazil in 2023. Other renewable energy projects under study or development include the use of municipal solid waste in power generation, biomethane, and green hydrogen. For instance, since 2017, the company has conducted solarimetric measurements in two solarimetric stations located in areas leased by Copel Brisa Potiguar. The development of this solar project is ready to advance to the next phase (implementation), subject to the opening of availability for connection with the company’s transmission system. The company is also developing studies for the implementation/acquisition of projects related to Generation Distribution, Energy Efficiency, Biomass, and Biogas. In addition to energy generation projects, investment opportunities in new energy transmission assets whose concession will be auctioned by the Brazilian government or existing assets that have synergy with the company’s portfolio are also being studied. With regards to innovation, in 2021, the company launched its Open Innovation program (Copel Volt). Copel Volt adds a business component to the company’s strategic vision with the goal to bring it closer to the startup ecosystem, upon the improvement of internal processes and the development of new businesses and services. With respect to Distributed Generation, the company is developing solar projects in Paraná relating to energy compensation of state of Paraná’s clients involving 50 MW with access asked to Copel Distribuição S.A, which shall be implemented in 2023. The company is also planning add 2MW at Solar Paraná portfolio (of which it has a 49% share), which already has 3MW in operation. Transmission and Distribution Transmission The company’s transmission system consists of all its assets of 230 kV (kilovolts) and greater and a small portion of its 138 kV assets, which are used to transmit the electricity it generates and the energy it receives from other sources. In addition to using its transmission lines to provide energy to customers in the state of Paraná, the company transmits energy through the Interconnected Transmission System. Two companies owned by the Brazilian government, Companhia de Geração e Transmissão de Energia Eletrica do Sul do Brasil – CGT Eletrosul and Furnas (Furnas Centrais Eletricas S.A), also maintain significant transmission systems in the state of Paraná. Furnas is responsible for the transmission of electricity from Itaipu, while CGT Eletrosul’s transmission system links the states in the south of Brazil. The company, like all other companies that own transmission facilities, is required to allow third party access to its transmission facilities in exchange for compensation at a level set by ANEEL. The company carries out the operation and maintenance of 3,705 kilometer (km) of transmission lines, forty one (41) substations in the state of Paraná and two (2) substations in the state of São Paulo. In addition, the company has partnerships with other companies to operate 5,980 km of transmission lines and eight (8) substations through special purpose companies (SPCs). Expansion and Maintenance of Transmission Facilities The construction of new transmission facilities of 230 kV and higher must be awarded in a bidding process or otherwise authorized by ANEEL. The company is permitted by ANEEL to make minor improvements to some of the existing 230 kV and 500 kV facilities. In November 2013, SPC Mata de Santa Genebra Transmissora, a strategic partnership between the company (50.1%) and Furnas (49.9%), won the right to build and operate 847 km of transmission lines and three substations in the states of Paraná and São Paulo. The construction schedule of the Mata de Santa Genebra project was affected by successive vandalism events, which resulted in the collapse of towers and theft of aluminum cables in transmission lines already installed and commissioned, in different sections of the project. On November 11, 2020, the LT 440 kV Fernão Dias / Taubate, the last asset of the SPC Mata de Santa Genebra project, began its commercial operation. With the completion of these steps, the SPC Mata de Santa Genebra became fully operational. In November 2015, Copel GeT won ANEEL’s public auction No. 005/2015 for the construction and operation of 188 km of transmission lines in the states of Paraná and Santa Catarina, and three (3) substations in the state of Paraná, with a total capacity of 900 MVA. Distribution The company’s distribution system consists of a widespread grid of overhead lines and substations with voltages up to 138 kV assets. Higher Voltage electricity is supplied to bigger industrial and commercial customers and lower voltage electricity is supplied to residential, small industrial, and commercial customers in addition to other customers. As of December 31, 2022, the company provided electricity in a geographic area encompassing approximately 97% of the state of Paraná and served 5.0 million customers. The company’s distribution grid includes 208,133 km of distribution lines; 462,584 distribution transformers; and 236 distribution substations of 34.5 kV, 36 substations of 69 kV, and 117 substations of 138 kV. During 2022, 84,947 new captive customers were connected to the company’s grid, including customers connected through the rural and urban electrification programs. The company is continuing to implement compact grid design distribution lines in urban areas with large concentration of trees in the vicinity of the distribution grid. The company has three (3) captive customers that are directly supplied with energy at a high voltage (69 kV and above) through connections to its distribution lines. The volume of energy commercialized for these customers was 41,628 megawatt hours (MWh) in 2022. The company is also responsible for expanding the 138 kV and 69 kV distribution grid within its concession area to meet any future demand growth. In 2019, Copel Distribuição (Copel Distribuição S.A.) launched a program to modernize its distribution grid called ‘Transformation Program’ (Programa Transformação). The Transformation Program consists of three projects: ‘Total Reliability’ (Confiabilidade Total), ‘Three-phase Paraná’ (Paraná Trifásico) and ‘Smart Grid Copel’. The Smart Grid Project deals with the implementation of a communication network for distribution automation equipment and for smart meters. In addition, computer systems for efficient management of this communication network are included in this project. Sales to Captive Customers During 2022, the company supplied approximately 82.5% of the energy distributed directly to Captive Customers in the state of Paraná. The company’s concession area includes nearly 5.0 million customers located in the state of Paraná and in one municipality in the state of Santa Catarina, located in the south of the state of Paraná. During 2021, the total power consumption of the company’s Captive Customers was 19,370 GWh. Sales to Free Customers The company operates in the ACL through its wholly owned subsidiaries, COPEL Geração e Transmissão S.A. and Copel Comercialização S.A. (Copel Mercado Livre). As of December 31, 2022, the company had 1,491 Free Customers (of which 1,490 were customers of its energy trading company and 1 of Copel GeT), representing approximately 10.4% of its consolidated operating revenue and approximately 16.7% of the total quantity of electricity sold by the company. During 2022, the total power consumption of the company’s Free Customers was 11,498 GWh. Low-Income Residential Customers: Under Brazilian law, the company is required to provide low level rates to certain low-income residential customers (Low-income Residential Customers). In December 2022, the company served approximately 575,136 low-income residential customers. Special Customers: A customer of the company’s distribution business that consumes at least 500 kilowatts (kW) (a ‘Special Customer’) may choose its energy supplier if that supplier derives its energy from alternative sources, such as small hydroelectric plants, wind plants or biomass plants. Other Businesses Gas Gas Distribution The concession for piped gas distribution services, granted to Companhia Paranaense de Gas – Compagas (Compagas) on July 6, 1994, was renewed in 2022, by the Government of the State of Paraná, for an additional 30 years starting July 6, 2024, and valid until July 6, 2054. The company’s corporate purpose is to provide piped gas distribution services to meet consumer demand in the industrial, commercial, residential, institutional, transportation, and other segments that may require the service in compliance with the legal provisions and in accordance with paragraph 2 of Article 25 of the Federal Constitution. As of December 31, 2022, the company held a controlling stake (51%) of the capital stock of Compagas. Gas Natural Power Plants In 2020, the company and Shell Brasil Petróleo formed the Consortium Copel Energia a Gás Natural to develop feasibility studies for natural gas power plants in the State of Paraná. The consortium hired consultants to provide specialized technical services to conduct studies to identify the best location for the implementation of natural gas-fired thermoelectric projects in the State. The studies have been completed and the consortium is planning the next project’s activities. Concessions The company operates under concessions granted by the Brazilian government for its generation, transmission, and distribution businesses. Generation Concessions Of the nineteen (19) hydroelectric plants the company operated in 2022, fourteen (14) were operated under the generation concession contracts that were in force prior to the 2013 Concession Renewal Law, and five (5) were operated in accordance with the 2013 Concession Renewal Law (Capivari Cachoeira HPP, Chopim I HPP, Marumbi HPP, Mauá HPP, and Colíder HPP). In 2013, 12 of the 13 hydro and thermoelectric generation concessions operated by the company in 2013 (exception made only to Rio dos Patos HPP) were extended pursuant to the old regime and could be renewed again under the 2013 Concession Renewal Law. Foz do Areia HPP: Copel Geração e Transmissão did not elect to renew the original concession pursuant the 2013 Concession Renewal Law for the Foz do Areia HPP (Governador Bento Munhoz da Rocha Netto). However, in order to obtain a new concession for the Foz do Areia HPP for 30 years, Copel GeT transferred the ownership of this HPP to its subsidiary, the SPC F.D.A. Geração de Energia Eletrica S.A (F.D.A) on March 3, 2020, and, on the same date, requested a new concession from the Ministry of Mines and Energy pursuant to Federal Decree no. 9,271/2018, amended by Federal Decree No. 10,135/2019 and No. 10,893/2021, which allows this renewal associated with the sale of shares of the concession holder, within 12 months of the end of the term. On December 23, 2022, Decree No. 9,271 was further amended by Decree No. 11,307, to also enable the renewal of grants by sale of shares of a holder through a public offering of shares. This alternative is in line with the intention of the controlling shareholder to transform the company into a company with dispersed capital and without a controlling shareholder. The company has requested to the MME the full renewal of the concession of its plants of HPP Foz do Areia, HPP Segredo, and HPP Caxias, with the maintenance of 100% of participation. Rio dos Patos HPP: The concession of Rio dos Patos HPP was terminated and not submitted to a further bidding process due to the lack operational conditions. Mourão I and Capivari Cachoeira HPP: The granting authority submitted the concessions for HPP Capivari Cachoeira and Mourão I to new bidding processes, pursuant to which new agreements should be in force for a 30-year period. Copel GeT was the winner in the bidding process related to HPP Capivari Cachoeira. With respect to Capivari Cachoeira, although Copel GeT did not elect to renew the original concession for the Capivari Cachoeira HPP, it participated in the new competitive bidding process and won. On January 5, 2016, Copel GeT executed a concession agreement with ANEEL so that it will continue to operate this plant under an operation and maintenance regime until 2046. Chopin I HPP: As the installed capacity of Chopin I HPP also does not exceed 5,000 kW, the concession regime of this plant has been changed to a registration in the company’s favor, valid for an indefinite term. In addition, pursuant to the same statute, the company may notify the granting authority of its intention to extend in 2024, the concession of Apucaraninha HPP; and in 2025, the concessions of Guaricana and Chamine HPPs. In the event the company does not request the extension of these concessions, they will be subject to new bidding processes conducted by the granting authority. Figueira TPP: The company’s concession for the Figueira TPP expired on March 26, 2019. The company had filed an extension request with respect to this plant on May 24, 2017, but it is still waiting for the granting authority to amend its concession agreement, extending its term for an additional 20-year period in accordance with the 2013 Concession Renewal Law. This plant has an installed capacity equivalent to 20 MW and underwent a recent modernization process. The company also has ownership interests in 11 other generation projects. Transmission Concessions The company has ownership interests in ten (10) other transmission projects, through special purpose companies. Distribution Concessions The company originally operated its distribution business pursuant to a concession contract that was signed on June 24, 1999 (retroactive to July 7, 1995) and was set to expire on July 7, 2015. Under the 2013 Concession Renewal Law, the company had the right to renew this concession for an additional 30-year period by accepting an amendment to the concession contract. In 2013, after a careful evaluation of the conditions imposed by the Brazilian government for the extension of the company’s distribution concession, it decided to request the renewal of this contract and its renewal request was approved by the MME (Ministerio de Minas e Energia) on November 11, 2015. On December 9, 2015, the company executed the fifth amendment to the public Electricity Distribution Service Concession Agreement No. 46/1999 of Copel Distribuição S.A. Strategy The key elements of the company’s business strategy are to maximize its value through sustainable growth, profitability, and adequate indebtedness levels and shareholder remuneration; seek to be a reference in customer satisfaction; seek opportunities related to new businesses and services in the energy sector; promote and ensure adherence to best ESG (social, environmental and governance), risk management and compliance practices; manage an integrated and strategic energy portfolio, including strategic partnerships and maximizing synergies and profitability; divest from non-strategic assets; pursue excellence in business processes; promote people-focused management, strengthening team engagement and reinforcing the culture of meritocracy; seek greater protagonism in the company’s interaction with regulators and institutions; consolidate a culture focused on safety, health, and quality of life; adopt new technologies to optimize the company’s business and continually raise cybersecurity levels; and encourage innovation as a lever for growth, increased customer satisfaction and loyalty, and process improvement. History Companhia Paranaense de Energia - COPEL was founded in 1954.