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MarketScreener Homepage  >  Equities  >  Bolsa de valores de Sao Paulo  >  Centrais Eletricas Brasileiras S.A.    ELET6   BRELETACNPB7

CENTRAIS ELETRICAS BRASILEIRAS S.A.

(ELET6)
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Centrais Eletricas Brasileiras S A : Relevant Fact - 08.01.20 - PE 2020-2035

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08/01/2020 | 04:21pm EDT

RELEVANT FACT

CENTRAIS ELÉTRICAS BRASILEIRAS S/A

CNPJ: 00.001.180/0001-26 | NIRE: 533.0000085-9

PUBLIC COMPANY

Centrais Elétricas Brasileiras S/A ("Company" or "Eletrobras") (B3: ELET3, ELET5 & ELET6; NYSE:

EBR & EBR.B; LATIBEX: XELT.O & XELT.B) hereby informs its shareholders and the market in general that, that the Eletrobras Board of Directors, at a meeting held on July 31, 2020, approved the Strategic Plan for Eletrobras Companies 2020-2035, which the content can be verified in the presentation attached to this Relevant Fact.

The previous strategic plan, 2015-2030, released through a Market Announcement of 11/27/2014, contemplated the changes resulting from Provisional Measure 579, of 9/11/2012 - converted into Law 12,783 of 01/11/2013, referring to the concessions that were extended at the time under the new conditions brought by referred law.

The impacts brought by MP 579 compromised the company's financial health in the following years, having been necessary to adopt a series of adjustment measures, based on the three strategic pillars that allowed the recovery of the company's balance: (i) Operational Excellence; (ii) Financial Discipline and (iii) Governance and Compliance.

The new Strategic Plan 2020-2035, in addition to defining a new corporate identity (Purpose, Vision and Values), establishes a set of guidelines and objectives aimed at the growth and modernization of Eletrobras and in line with the new trends in the energy sector.

Rio de Janeiro, August 01, 2020.

Elvira Cavalcanti Presta

CFO and Investor Relations Officer

Internet: www.eletrobras.com/elb/ri

E-mail: ombudsman-ri@eletrobras.com

Address: Rua da Quitanda - 9th floor.

20090-070, Centro. Rio de Janeiro - RJ Phone Number: (21) 2514-6333 / 4627

EBR & EBR.B

LISTED

ELET3 &

NYSE

This document may contain estimates and forecasts that are not statements of fact that occurred in the past but reflect our management beliefs and expectations and may constitute future events' forecasts and estimates under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. The words "believe", "may", "estimate", "continue", "anticipate", "intend", "expect" and related words are intended to identify estimates that necessarily involve risks and uncertainties, known or unknown . Known risks and uncertainties include, but are not limited to: general economic, regulatory, political and commercial conditions in Brazil and abroad, changes in interest rates, inflation and value of the Real, changes in volumes and the pattern of use of electricity by consumer, competitive conditions, our level of indebtedness, the possibility of receiving payments related to our receivables, changes in rainfall and water levels in the reservoirs used to operate our hydroelectric plants, our financing and capital investment plans, existing and future government regulations , and other risks described in our annual report and other documents filed with CVM and SEC. Estimates and forecasts refer only to the date they were expressed and we assume no obligation to update any of these estimates or forecasts due to the occurrence of new information or future events. Future results of the Company's operations and initiatives may differ from current expectations and the investor should not rely solely on the information contained herein. This material contains calculations that may not reflect accurate results due to rounding.

ELETROBRAS STRATEGIC

PLAN 2020-2035

July 2020

Strategic Plan

Disclaimer

This presentation intends to show the shareholders and the market in general, the strategies and initiatives Eletrobras will pursue to achieve its Strategic Plan 2020-2035 goals. However, it is important to note that

this presentation contains certain estimates. Such estimates are not statements of past or future events, but reflect our management's

beliefs and expectations and may constitute uncertain approximations and projections about future events in accordance with the Securities and Exchange Commission of Brazil and the Securities and Exchange Commission, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended.

The words "believes", "may", "estimates", "anticipates", "intends",

"anticipates", "potential" and similar aim at identifying estimates that necessarily involve risks and uncertainties, known or not. Known risks and uncertainties include, but are not limited to, economic, regulatory, political and commercial conditions in Brazil and abroad, changes in interest rates, inflation and value of the Brazilian Real, changes in volumes and patterns of electricity use by consumer, competitive

conditions, our level of indebtedness, the possibility of receiving

payments related to our receivables, changes in rainfall and water levels in the reservoirs used to power our hydroelectric plants, our financing and capital investment plans, existing and future government regulations, and other risks described in our Reference Form, Forms 20-Fs and other documents registered by the Brazilian Securities and Exchange Commission of Brazil (CVM) and U.S. Securities and Exchange Commission (SEC).

Therefore, the estimates and projections in this document refer only to the date in which they were expressed, with no obligation in our part to perform or update any of these measures, financial metrics or projections because of new information of future events. It is important to highlight that Eletrobras has not changed its disclosure policy and

continues to not disclose projections respecting the CVM Instructions No. 480 and No. 538. The future results of the Companies' operations and

initiatives may differ from current expectations and the investor should not rely exclusively on the information comprised herein.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 3

Summary

COVID-19 AND ITS IMPACTS ON ELETROBRAS STRATEGIC PLAN

1

THE CHALLENGE OF RECENT YEARS

2

PROBABLE FUTURES: IN WHICH ENVIRONMENT WILL WE OPERATE?

3

OUR COMPETITIVE ADVANTAGES

4

OUR ESSENCE AND WHAT WE LOOK FOR

5

PRIORITIZED SUSTAINABLE DEVELOPMENT GOALS

4

COVID-19 and its impacts on Eletrobras Strategic Plan

The COVID-19 pandemic, caused by the wide transmission of coronavirus, has profoundly impacted the economy, as

well as Eletrobras companies.

Eletrobras has been following orientations from the Ministry of Health and state and city-level governments where its companies and operational units are located. Eletrobras has also

created a Crisis Committee that

coordinates and monitors every action related to the pandemic.

ADOPTED MEASURES

Coordinated operation with agents of the

Brazilian electric sector

Contingency Plan: mapping, monitoring and orientation of necessary actions in the

generation and transmission operations

Preservation of essential activities

Care with its employees and collaborators in

order to avoid COVID-19 transmission. 63%

of its employees are currently working from

home and 9% on vacation

ELETROBRAS STRATEGI C PLAN 2020 - 20 3 5 | 5

COVID-19 and its impacts on Eletrobras Strategic Plan

APART FROM THE ATYPICAL SCENARIO, SOME RISKS AND IMPACTS MAY BE IDENTIFIED

Identified Risks and impacts

Reduction in energy demand with magnitude still uncertain. As a result, the oversupply scenario and the postponement of new auctions prevail.

Difficulties in the Regulated Contracting Environment (ACR), with over-contracting of distribution companies.

Postponement of the discussion and the Brazilian Electric Sector Modernization Bill and Eletrobras privatization. However, privatization may be an alternative for economic recovery

post crisis, given the future needs for infrastructure investment.

FOR THE LONG TERM (STRATEGIC PLAN 2035), IT IS EXPECTED THAT THE FOUNDATIONS USED TO DEVELOP THIS STRATEGIC PLAN, SUCH AS ELECTRIC SECTOR MAIN TRENDS AND PRE CRISIS CONDITIONS, WILL BE MAINTAINED. THEREFORE, LONG TERM STRATEGY IS STILL VALID, AS WELL AS THE PROPOSED GOALS.

E LE TROB RA S S TRA TE GI C P LA N 2020 - 20 3 5 | 6

1 The challenge of recent years

Eletrobras was profoundly impacted by the MP 579¹ in 2012 and

had its financial health compromised in the following years. As a

result, great adjustments measures were taken in the recent years,

focusing on its indebtedness reduction and financial balance

recovery, adjustment of real costs to regulatory costs in generation a d tra s issio a d re over of the o pa y's ala e.

In the meantime, Eletrobras reduced its investments, lost market

share and payed out less dividends, lowering its shareholders

financial returns.

7

1: Brazilian acronym for Provisional Measure.

2012-2015 - a difficult crossing

MP 579/2012 heavily impacted Eletrobras financial health. In the period 2012-2015, losses reached BRL 30 billion. Between 2011 and 2015, the company lost about 65% of its market value. The gross debt exceeded its net worth in 2015.

Net profit

BRL billion

13,3

10,7

3,7

3,5

-3,0

-1,7

-6,9

-6,2

-14,9

31 bi

2011

2012

2013

2014

2015

2016

2017

2018

2019

Market Value x Equity Value

BRL billion1

76,8

70,9

61,4

51,2

42,3

26,5

42,1

31,7

33,8

9,7

8,5

9,0

2011 2012 2013 2014 2015 2016 2017 2018 2019

Equity Value

Market Value

Gross Debt x Net Worth

BRL billion

70,9

61,4

55,5

43,4

44,2

51,0

46,8

42,6

42,1

24,3

2013

2014

2015

2016

2017

2018

2019

NW

GD

Sources: Chart 1: Eletrobras Financial Statements. Chart 2: Economát ica (market value) and Eletrobras Financial Statements (equity value). Chart 3: Investors Reports 4T14, 4T15, 4T16, 4T17, 4T18 e 4T19. The most recent values from each period were used.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 8

2016-2019 - Recovery efforts

Strong adjustment measures were taken in order to recover Eletrobras balance, operational efficiency increase and indebtedness reduction.

The search for Operation Efficiency

PMSO/ Regulatory PMSO¹

1,57 1,53

1,32 1,24

2016

2017

2018

2019

Indebtedness Reduction

Net Debt / EBITDA²

6,5

6,1

In September 2016, the indicator

reached the mark of 8,7

3,7

3,1

2,2

2015

2016

2017

2018

2019

Notes: (1): Brazilian acronym for Personal, Materials, Services and Others. (2): EBITDA without RBSE (Brazilian acronym for Basic Network of Existing System).

Sources: Chart 1: Monitoring of PDNG 2018-22 (2016 and 2017) and PDNG 2020-24 v.17.12.19 (2018 e 2019); Chart 2: Investors Report 4T16,

4T17, 4T18 e 4T19. The most recent values from each period were used.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 9

2016-2019 - Recovery efforts

Recovery efforts reduced Eletrobras investment capacity and its payment of dividends.

Realized investment

Payment of dividends1

BRL billion1

Dividends per share (BRL/ share)

11,2

11,4

In 2014, 2015 and 2017, dividends

10,4

were barely paid out

1,63

1,63

8,7

1,39

1,47

1,04

5,2

4,6

0,86

3,3

0,40

0,10

0,00

0,00

0,00

0,00

2013

2014

2015

2016

2017

2018

2013

2014

2015

2016

2017

2018

2019

2019

PNB ON

Notes: (1). Despite of high net profit in 2018 (BRL 13,2 billions) resulting from the loss reversal with Angra 3 (BRL 7,2 billions), payment of dividends was limited to R$ 1.3 billion due to cash limitations, causing a BRL 2,3 billion reserve of dividends.

Sources: Chart 1: Investors Report, Eletrobras. Chart 2: https://eletrobras.com/pt/ri/Paginas/Direitos.aspx; DFP 2018.

ELETROBRAS STRATEGIC PLAN 2020-2035 |

10

The relevance and value creation challenge

In this period, Eletrobras lost market share, with little participation in auctions, and generated less results to its shareholders. The

current challenge is to elevate its investment capacity and create more value to its shareholders.

Installed electricity generation capacity (GW)

Expected investment 2020-2024

Eletrobras

BRL billion1

220

Brazil

Share

120%

Annual average 2020-2024:BRL 6,5 bi

150 158 163

170

178 179 187 195

160

176

200

180

100%

120

117

120

126

134

141

80%

140

Annual average 2020-2024, without Angra 3: BRL 3,7 bi

100

30%

60%

80

36%60

40%

40

26%

20

42

42

43

44

46

47

48

50

51

51

51

51

51

51

20%

7,4

6,9

0

0%

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

6,7

6,2

5,3

2,6

3,4

3,5

Electricity transmission lines (thousand Km)

1,1

3,4

160%

220

200

126

130

135

133

137

144

148

154

160

167

173

140%

4,2

4,1

4,0

160

120%

180

140

100

106

115

100%

3,4

2,8

45%

120

47%

80%

100

52%

60%

80

2020

2021

2022

2023

2024

60

39%

40%

40

20

56

55

57

61

61

63

65

65

65

66

66

66

66

66

20%

Corporate + Special

0

0%

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

Purpose Entity

Angra 3

Sources: Chart 1: 2011-2019: Monthly Monitoring Bulletin of the Brazilian Electric System- Dec/2019; 2020-2024: PNDG 2020-2024 and

The Ten-Year Energy Expansion Plan 2029

ELETROBRAS STRATEGIC PLAN 2020-2035 | 11

Chart 2: PDNG 2020-2024.

2 Probable futures: in which environment will we operate?

Decarbonization, alternative energy sources, distributed generation, technological disruption, accelerated digitalization. Those and other trends from the electric sector will call for adjustments in Brazilian sectorial model.

Possibilities from those adjustments, combined with Brazil economical evolution and its electricity demand outspread, generate four scenarios for the Brazilian electric sector.

Two of them, which point out to a broad modernization of the regulatory framework, refer to Eletrobras strategy for the next 16 years.

12

The Ds of the electric sector

DECARBONIZATION

is the challenge! Energy generation with lower GHG emissions

DIVERSIFICATION

of the electrical matrix, with more alternative energy sources

DECENTRALIZATION

of the energy generation, with distributed generation on site or close to the consuming unit

DIGITALIZATION

big data and automation with large impacts on energy efficiency and costs reduction

DISRUPTION

in technology, business models and smart electricity consumption

E LE TROB RA S S TRA TE GI C P LA N 2020 - 20 3 5 | 13

Electric sector trends

Transformation in the electric sector, requiring adjustments in the industry model

Expansion of electrical energy

Multiplying and repositioning

demand

market players

Change in the Electric Matrix

Expansion of distributed

profile

generation

ELECTRIC SECTOR

TRENDS

Expansion and increasing complexity of the electrical energy transmission system

Systemic gains due to energy efficiency

Acceleration of technological change

Reduction in the cost of crucial inputs

ELETROBRAS STRATEGIC PLAN 2020-2035 | 14

Scenarios for the Brazilian electric sector in 2020-2035

Given the uncertainties of the environment, the long-term strategy needs to be robust to navigate, especially between

scenarios 1 and 2

BRAZIL'S ECONOMIC EVOLUTION

STRONG AND SUSTAINED GROWTH

OF TRANSFORMATIONS IN THE

ELECTRICITY SECTOR MODEL

GROWTH

HIGH INTENSITY

AND COMPETITION WITH

GROWTH AND

REGULATED ADAPTATIONS

COMPETITION

ADJUSTMENTS IN THE CURRENT MODEL

NEW MODEL

MODERATE COMPETITION

AMPLITUDE

BRAZILIAN

LOW DYNAMISM AND

IN A LOW GROWTH

INERTIAL GROWTH

MARKET

ANEMIC AND INTERMITTENT GROWTH

ELETROBRAS STRATEGIC PLAN 2020-2035 |

15

Reference scenarios 2020-2035

Scenarios main characteristics

1 - Growth and competition in high intensity - and 2 - Moderate competition in a low growth market

Comprehensive modernization of the regulatory

framework

Expansion of electricity demand, varying from tendential to large, induced by the market (private, foreign and diversified capital)

Decentralized risk management, with risks being gradually allocated in the value chain, creation and maturing of hedge mechanisms in the long term (energy exchange, derivatives, etc.)

Consolidation and structuring of traders and

maturation of the market, with progressive reduction of speculative spaces

Matrix diversification: strong increase in renewables and use of pre-salt gas in the electricity generation

High-quality business environment, legal certainty and

medium to high attractiveness for investors

ELETROBRAS STRATEGIC PLAN 2020-2035 | 16

3 Our competitive advantages

Leadership in electricity generation and transmission, presence throughout

the Brazilian territory and an electrical matrix formed by 96% clean energy

constitute a solid foundation to strengthen, with efficiency gains, Eletrobras

strategic positioning and results generation.

17

Leadership in electricity generation and transmission

GENERATION

51.143 MW

installed electricity generation capacity in 2019

30,1%

Brazilian installed electricity generation capacity

96%

Clean energy capacity*

Generation of

185.025 GWh in 2019

TRANSMISSION

71,154 thousand km

transmission lines in 2019

45,2%

Brazilian National Interconnected System transmission lines

Fonte: Eletrobras, 2019. * Includes renewables and nuclear.

ELETROBRAS STRATEGIC PLAN 2020-2035 |

18

G&T Assets

ROBUST PORTFOLIO

125 Operating power plants in 20191

58 corporate, 67 SPEs

92% renewables

4%

4% 2%

0,002% - Solar

Hydroelectric

Thermal

Nuclear

Wind

90%

Solar

Fonte: Eletrobras, 2019

64,1 thousand km

7,0 thousand

Corporate and corporate in

Transmission lines in

O&M regime

SPEs

8%

12%

Corporate

Corporate in O&M regime

78%

SPE Eletrobras participation

ELETROBRAS STRATEGIC PLAN 2020-2035 | 19

Presence throughout the Brazilian territory

CAPILLARITY

Eletrobras companies'

operating plants in Brazil on 12/31/2019 | Map 1

Wind

SPE wind

Thermal

Hydroelectric

SPE Hydroelectric

Hydro Shared Property

Nuclear

Solar

Localization of electricity transmission lines in Brazil | Map 2

Existing Future

Eletrobras companies

Eletrobras companies with partnerships

Others from Eletrobras

Source: Administration Report 2019. Eletrobras.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 20

Advances in Eletrobras Companies' integrated management

ERP SAP DEPLOYMENT PROGRAM

SHARED SERVICES CENTER DEPLOYMENT

The deployment of ERP, realized in stages,

The deployment of Shared Services Center (SSC), completed

contemplated the following companies

in 2019, centralizes Eletrobras Companies' transnational and

Amazonas GT

support activities in various processes:

Eletrobras Holding

Chesf

Cepel

Finances

IT

CGTEE

Eletropar

Eletronorte

Eletrosul

Furnas

Accounting

Legal

Eletronuclear

Human Resources

Logistics and

infrastructure

2018

2019

2020

Purchasing

General Services

Verified savings in 2018: BRL 180 million

BRL 374,5 million

Verified savings in 2019:

and in 2019: BRL 76 million

Fonte: Eletrobras, Sustainability Reports 2018 e 2019.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 21

4 Our essence and what we look for

Aware of the challenges to be overcome and its strengths, Eletrobras renews its essence - based on the compromise with sustainable development of

society, ethics and respect for people and life.

An innovative, clean energy company, recognized for excellence and sustainability. A company that operates with high performance standards, having as goal value creation for its investors and other stakeholders.

22

Business identity

Purpose

We put all our energy into the sustainable development of society

Values

We are guided by:

Respect for people and life

Ethics and transparency

Excellence

Innovation

Collaboration and recognition

ELETROBRAS STRATEGIC PLAN 2020-2035 | 23

Business identity

Values

We are guided by and are committed to:

Respect for people and life: Respecting differences, diversity, individual and collective rights, and life in all its forms, with security and equity.

Ethics and transparency: Being straightforward and honest, loyal to our commitments, aware of our responsibilities and transparent in our actions and results at all times.

Excellence: Pursuing excellence, the quality of resource allocation, the discipline of execution, the culture of high performance and the generation of value for our stakeholders.

Innovation: Stimulating the culture of innovation to create new ideas and solutions capable of impacting the future of energy and its applications in the organization.

Collaboration and recognition: Valuing merit, commitment, collaboration and continuous learning, establishing conditions that promote personal and professional development with the consequent expansion of competitiveness.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 24

Vision

To be an innovative,

clean energy company,

recognized for

excellence and sustainability.​

Indicators to be monitored

» % Clean energy: renewables + nuclear

Clean energy

»

% de Renewables

Excellence and »

Return on Equity - ROE (Net Income/Shareholder

economical

equity)

sustainability

» Assets Value - (US$ BI)

Environmental

» % Clean energy: renewables + nuclear

sustainability

»

GHG Emissions (TonCO2/TWh)

Social

» # Direct and indirect jobs generated

sustainability

» # People served by social projects

ELETROBRAS STRATEGIC PLAN 2020-2035 | 25

Vision

"To be an innovative, clean energy company, recognized for excellence and sustainability.​"

CLEAN ENERGY AND ENVIRONMENTAL SUSTAINABILITY1

Clean energy (GW and %) - 2018

Renewables (GW and %) - 2018

GHG Emissions (TonCO²/TWh) - 2018

(1) CTG

99%

(1) CTG

123

99%

123

(1) Rus Hydro

5

(2) EDF

(2) Engie

89%

(2) KEPCO

652

83%

103

105

(3) Engie

89%

(3) Eletrobras

46

92%

(3) Hydro Quebec

1.336

103

(4) Eletrobras

96%

(4) COPEL

20.055

48

(4) ENEL

46%

39

(5) Hydro Québec

37; 100%

(5) Eletrobras

32.939

37

(5) Hydro Québec

100%

(6) Iberdrola

35

35; 68%

37

(6) CPFL

95.100

GW

(6) Iberdrola

62%

GW

32

(7) Cemig

102.231

(7) Rus Hydro

31

31; 78%

(8) Ontario Power

15; 90%

(7) Rus Hydro

78%

(8) EDF

147.000

15

31

EXCELLENCE AND ECONOMICAL SUSTAINABILITY2

Profitability (ROE) - 2018

Assets value (US$ BI) - 2018

(1) Engie Brasil

(1) State Grid

522

36,6

(2) Eletrobras

23,8

(2) EDF

314

(3) Taesa

23,4

(3) ENEL

183

(4) Energisa

19,5

(4) Engie

170

(5) KEPCO

155

(5) AES Tiete E

18,9

(6) Duke Energy

145

(6) Equatorial

17,7

(7) Iberdrola

125

(7) CPFL Energia

17,3

(22) Eletrobras

42

Fonte: (1) Companies website, accessed between 01/31/20 and 01/10/20; PRAE; Macroplan. Observations: Hydro Québec (2015); CTG (2017); Eletrobras

ELETROBRAS STRATEGIC PLAN 2020-2035 | 26

(2019); Rus Hydro (2019); KEPCO (approximated value). (2) Economática. (3) S&P Capital IQ (www.capitaliq.com), acce ssed on 01/31/20; Macroplan.

2020-2035 - ELETROBRAS STRATEGIC TRANSFORMATION

The challenge we expect to overcome with this strategic plan.

Investment

capacity

Lean and agile

management

Value creation

High performance

culture

More competitiveness,

Where

less costs

we are

Active risk management

Digital organization

Where do we want to get

Vision

To be an innovative, clean

energy company, recognized

for excellence and

sustainability.​

ELETROBRAS STRATEGIC PLAN 2020-2035 | 27

VISION

Strategy 2020-2035

To be an innovative, clean

Strategy and stakeholders

energy company, recognized for

excellence and sustainability.​

Investors, shareholders and market analysts

BUSINESS AND

Clients

PURPOSE

MANAGEMENT

PERFORMANCE

GUIDELINES

GUIDELINES

Government, parliamentarians and

We put all our

Culture and

regulatory bodies

Value and

energy into the

people

investment

sustainable

Press and opinion leaders

New

G&T

Management

Governance

development of

businesses

efficiency

society

Innovation and

Community

Commerci

G&T

digital

alization

expansion

transformation

Society

VALUES

Partners, sponsors and suppliers

Respect for people and life

Ethics and transparency

Workforce and relatives

Excellence

Innovation

Collaboration and

recognition

ELETROBRAS STRATEGIC PLAN 2020-2035 | 28

Strategic Map 2020-2035

Purpose

We put all our energy into the sustainable development of society

Values

  • Respect for people and life
  • Ethics and transparency
  • Excellence
  • Innovation
  • Collaboration and recognition

Vision

To be an innovative, clean energy company, recognized

for excellence and sustainability.​

Business and performance guidelines

Multiply value creation and expand the company's investment capacity

Create value by increasing the efficiency of G&T assets

Consolidate leadership in G&T, focusing on clean energy

Achieve leadership in trading, with attractive margins and risk management efficiency

Invest in new businesses, focused on energy, participating in the consolidation of the sector (M&A)

Management guidelines

Develop a high-performance culture and excellence in people management, with meritocracy

Achieve excellence in Governance, Risk

Management and Internal Controls

Focus the company's management on value creation and competitiveness increase

Take a leading role in innovation and promote the digital transformation of business and management processes

Strategic objectives

Optimize the capital structure of the Eletrobras group

Increase the Company's investment capacity

Optimize the economic-financial performance of G&T assets

Achieve high levels of reliability of G&T assets

Increase regulatory effectiveness with active action with the regulator

Expand generation, prioritizing clean energy and gas thermal opportunities

Expand transmission, focusing on value creation

Diversify the customer portfolio, expanding operations in energy retail

Develop the energy trading segment

Increase revenue from services sales, data transmission and other synergistic opportunities

Value meritocracy with a system of incentives and consequences

Develop leadership, teamwork and knowledge management to sustain the company's critical competencies

Ensure employee safety and satisfaction

Acquire and develop robust risk management competence

Achieve and maintain standards of corporate governance and business integrity in accordance with international benchmarks

Promote active institutional articulation and transparency in the relationship with stakeholders

Strengthen execution discipline, with agility and optimization of resources

Accelerate the digitization and automation of business and management processes

Invest in research and innovation, creating an innovative ecosystem based on internal capabilities and partnership with startups

ELETROBRAS STRATEGIC PLAN 2020-2035 | 29

G&T EXPANSION:

Strategic Guidelines 2020-2035

BUSINESS PERFORMANCE

INDICATORS

VALUE AND INVESTMENT

Increase value generation and expand the company's

MARKET VALUE: Enterprise Value / EBITDA

investment capacity

BUSINESS

Create value by increasing the efficiency of G&T assets

G&T EFFICIENCY

G&T EXPANSION

Consolidate leadership in G&T, focusing on clean energy

COMMERCIALIZATION

Achieve leadership in commercialization, with high margin

and risk management efficiency

NEW BUSINESSES

Invest in new businesses, focused on clean energy,

participating in the consolidation of the sector (M&A)

AVAILABILITY: DISPGR, DISPOLT / EFFICIENCY: PMSO/PMSO Reg. Installed capacity and G&T Market share

MARGINS: Margin in relation to the reference price

REVENUE: New businesses revenue/ Total revenue (%)

GOVERNANCE, MANAGEMENT AND CRITICAL COMPETENCES

CULTURE AND PEOPLE

GOVERNANCE

MANAGEMENT

INNOVATION AND DIGITAL TRANSFORMATION

Develop a high-performance culture and excellence in people management, with meritocracy

Achieve excellence in Governance, Risk Management and Internal Controls (GRC)

Focus the company's management on generating value and

increasing competitiveness

Take a leading role in innovation and promote the digital transformation of business and management processes

SAFETY: Accident Frequency Rate / PEOPLE: Employee Satisfaction Index and Training Hours/ Number of employees

GOVERNANCE: ELB position on B3 list

PRODUCTIVITY: Operating result/ employee

INNOVATION: R&D+I Investment / NOR (%)

ELETROBRAS STRATEGIC PLAN 2020-2035 | 30

Generation and Transmission Investment

INVESTMENT UNDER THE NO PRIVATIZATION SCENARIO

Considering the maintenance of the quota regime for plants

extended by Law 12.783 / 2013

Maintaining the Company's financial discipline with the Net Debt / EBITDA indicator <2.5

INVESTMENT UNDER THE PRIVATIZATION SCENARIO

Considering the decotization of the plants extended by Law 12,783 / 2013 and the signing of new electricity generation concession contracts from an independent producer, it would generate an increase in the Company's EBITDA.

Maintaining the Company's financial discipline with the Net Debt / EBITDA indicator <2.5

Total investment in G&T expansion¹

Total 2020-2035:BRL 95,3 billion Per year: BRL 6,0 billion

Total investment in G&T expansion

Total 2020-2035:BRL 201,9 billion Per year: BRL 12,6 billion

Notes: 1: Includes Angra 3.

ELETROBRAS STRATEGIC PLAN 2020-2035 | 31

5 Prioritizedgoals sustainable development

Sustainability is in Eletrobras essence, in the electrical energy it produces and in its way of making business.

Aligned with the Sustainable Development goals, Eletrobras has actions related to all of them, but prioritizes nine with projects linked to its business or its commitment to society.

32

Sustainability is our business model, which permeates and encompasses the entire Eletrobras Strategy.

SDGs prioritized by Eletrobras

INDUSTRY,

PEACE, JUSTICE

AFFORDABLE

DECENT WORK

CLIMATE

AND CLEAN

AND ECONOMIC

INNOVATION AND

AND STRONG

ACTION

ENERGY

GROWTH

INFRASTRUCTURE

INSTITUTIONS

RESPONSIBLE

REDUCED

SUSTAINABLE

LIFE ON LAND

CONSUMPTION

CITIES AND

INEQUALITIES

AND PRODUCTION

COMMUNITIES

ELETROBRAS STRATEGIC PLAN 2020-2035 | 33

Disclaimer

Eletrobrás - Centrais Elétricas Brasileiras SA published this content on 01 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 August 2020 20:21:19 UTC

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Financials
Sales 2020 28 452 M 5 299 M 5 299 M
Net income 2020 7 054 M 1 314 M 1 314 M
Net Debt 2020 25 146 M 4 683 M 4 683 M
P/E ratio 2020 10,6x
Yield 2020 4,47%
Capitalization 52 868 M 9 837 M 9 846 M
EV / Sales 2020 2,74x
EV / Sales 2021 2,76x
Nbr of Employees 12 975
Free-Float 45,3%
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Technical analysis trends CENTRAIS ELETRICAS BRASILE
Short TermMid-TermLong Term
TrendsNeutralNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 7
Average target price 52,51 BRL
Last Close Price 35,15 BRL
Spread / Highest target 76,1%
Spread / Average Target 49,4%
Spread / Lowest Target 2,42%
EPS Revisions
Managers
NameTitle
Wilson Pinto Ferreira President, Chief Executive Officer & Director
José Guimarães Monforte Chairman
Elvira Baracuhy Cavalcanti Presta Chief Financial & Investor Relations Officer
Vicente Falconi Campos Director
Mauro Gentile Rodrigues de Cunha Independent Director
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