AES Brasil Energia S A : ESG Performance Report

ESG Performance Report

1Q24

Summary

Strategy	3
100% renewable energy generation	4
2030 ESG Commitments	6
Corporate Governance	8
Ownership and control	9
Board of Directors	10
Compensation	11
Risk management	12
Ethics and Compliance	13
Environmental Management	14
Environmental Management System	15
Water and water security	16
Biodiversity and land use	18
Carbon emissions	20
Social Management	21
Attracting and retaining talents	22
Diversity and Inclusion Program	25
Development and assessment of suppliers	26
Health and Safety Management System	27
Community relations	29

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About this Report

ESG Performance Report is an AES Brasil publication that discloses, in a timely manner, with updates in line with the quarterly disclosure of results, the ESG (Environmental, Social and Governance) performance, strengthening the positioning and strategic development journey of the company. Indicators included in this material were selected based on their relevance to investors as well as other stakeholders.

For more detailed information see Policiesand Integrated Sustainability Reportof AES Brasil, published annually and prepared based on the methodologies of the Global Reporting Initiative (GRI) and the Integrated Report of the International Integrated Reporting Council (IIRC) and audited by an independent third party.

Strategy

ESG Performance 1Q24

Strategy

100% renewable energy generation

Present in the country for over 20 years, AES Brasil is a company that generates power from 100% renewable sources, which acts as an integrated platform that can be adapted to its customers' demands.

Currently, AES Brasil has a portfolio of renewable assets with operational installed capacity and under construction in the amount of 5.2 GW1 exclusively renewable energy. The portfolio in São Paulo state comprises 9 plants and 3 small hydro power plants (SHHPs), located in Paraná hydrographic basin, and 2 large solar complexes. In the northeast region of the country, aiming to increase generation capacity in line with the diversification of non-hydro energy sources, the company has 7 wind complexes in operation and 1 under construction, Cajuína. In the south region, the company has 1 wind complex.

The company dedicates its efforts and works to become a diversified generation platform, being distinguished by its 100% renewable portfolio, customer focus and its excellence as an asset manager. The company's goal is to increase its generation capacity, diversifying its portfolio with non-hydro sources and long-term agreements.

Current Installed Capacity

by source

6%

43% 5.21 GW 51%

Hydro Wind Solar

4 ¹ 5.1 GW in operation and around 0.1 GW in the final construction phase (Cajuína 2 and AGV VII).

(under construction)

Strategy

100% renewable energy generation

AES Brasil is committed to innovating and delivering complete solutions to its customers, so that more and more products and services are available with lower environmental impact. The company offers solutions that help decarbonize the value chain of customers, while ensuring the delivery of the energy supply required for each type of activity.

Aiming at maximizing value creation opportunities and consolidating AES Brasil's vision as the customer's preferred choice for the free energy market, Energia+ was launched, a digital retail energy trading platform. It is an environment designed to simplify and reduce bureaucracy in access to the free market, with competitive prices for each consumption profile. Currently, the platform relies on the collaboration of selected partners to expand the range of offers and services.

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São Paulo

Hydro - 2,658 MW

Guaimbê - 150 MW

Ouroeste - 145 MW

AGV VII - 33 MW

Rio Grande do Sul

Cassino - 64 MW

Piauí

Ventos do Araripe - 210 MW

Ceará

Mandacaru - 108 MW

Rio Grande do Norte

Cajuína 1 - 314 MW

Cajuína 2 - 370 MW (74MW under construction)

Ventus - 187 MW

Salinas - 50 MW

Pernambuco

Caetés - 182 MW

Bahia

Tucano - 322 MW

Alto Sertão II - 386 MW

Strategy

The company's strategy is to be the best choice for customers in the free market, offering Resilient, Competitive and Responsible solutions. The Responsible pillar of the strategy refers to the way in which businesses are conducted and developed with the objective of promoting positive impacts and avoiding or minimizing negative impacts. With ethics and transparency, the corporate governance and decision-making processes consider the best practices and criteria for the management of socio-environmental aspects. The definition of the 2030 ESG Commitments has as its starting point the Sustainable Development Goals (SDGs) of the 2030 Agenda, proposed by the United Nations (UN).

Aware of the shared challenge that this set of goals represents for the whole of society, AES Brasil recognizes the fundamental role of renewable energy for a new economy and the need to develop other transversal themes to the business to effectively contribute to the 2030 Agenda. As a result, commitments and goals were established related to 6 priority SDGs and determined 3 main themes related to Environmental, Social and Governance aspects: Climate Change; Diversity, Equity and Inclusion; and Ethics and Transparency, respectively.

Priority SDGs

Commitments

Goals

Promoting diversity, equity and inclusion, ensuring equal opportunities at all levels

• By 2025, have 30% women in senior leadership positions.

Contribute to the energy transition with the increase of	→ Contribute through the generation of renewable energy so that our customers avoid the emission of 582 thousand tCO2e per
renewable sources in the Brazilian electricity matrix	year from 2025.

Transforming lives through the local development of communities neighboring our operations and ensuring equal opportunities

• By 2030, have 30% of underrepresented groups (ethnic-racial, gender identity and sexual diversity) in the lead.
• Hire at least 50% of local labor in the construction of new ventures.

Positively impact climate change mitigation efforts.

• By 2030, reduce Scope 1 and 2 greenhouse gas emissions by 18% tCO2e per MWh generated, compared to 2020.
• Maintain neutralization and positive greenhouse gas emissions annually.
• By 2025, offset historical emissions since the beginning of AES Brasil's operations*.

	Conserve, protect and preserve biodiversity	→ By 2030, increase reforestation by at least 20% in addition to the commitment to recover occupied areas.

6 *Considering emissions from 1999 to 2019, scopes 1, 2 and 3.

Strategy

Our commitments to sustainable development and excellence in ESG management are recognized by the market, strengthening our capacity to generate value for all stakeholders.

• The only AAA-rated power company in Latin America in the MSCI ESG¹ criteria assessment, for the third consecutive year
• ESG performance assessed by Sustainalytics¹ rating
• Company selected, for the 17th consecutive year, to compose the B3 Corporate Sustainability Index (ISE) portfolio
• Score A- in the Carbon Disclosure Project (CDP) Climate Change questionnaire and score B in the Water Security questionnaire

• EcoVadis Gold Seal in the socio-environmental assessment
• "Most incredible company to work for in the Energy Sector" in 2023 for the 2nd consecutive year, according to the FIA ​​e UOL survey
• For the 3rd consecutive year, we are recognized as one of the TOP 100 Open Corps in the Energy sector
• Among the three companies with a score of 10 in ESG in the Melhores e Maiores ESG ranking by Exame magazine in 2021
• Recognized by EXAME magazine among the best of ESG in 2021 and 2022
• Our Greenhouse Gas Emissions Inventory (GHG Protocol) has been recognized with the Gold Seal for 6 consecutive years

¹Sustainalytics and MSCI Disclosure Statements are available on page 30

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Corporate Governance

ESG Performance 1Q24

Corporate Governance

Ownership and control

AES Brasil is listed in the Novo Mercado segment of B3, which sets a high level of governance, since March 2021. Subsequently, in October 2021, we concluded the transaction with the merger of AES Tietê Energia S.A. into AES Brasil Operação S.A, the latter succeeding it as the holder of the operating assets of AES Brasil. The change contributes to the flexibility of the growth strategy, through the allocation of new projects and acquisitions in subsidiaries, also increasing the leverage potential of these new investments. The new corporate structure will allow the separation between the operational assets, which make up AES Brasil Operação S.A, and the greenfield projects, structured in Special Purpose Entities (SPEs). AES Brasil Energia S.A. is the holding company for all these companies. Check the corporate structure on the IR website.

The company reviewed and published strategic internal policies to provide higher transparency to its stakeholders, with emphasis on the policies for Management Appointment and Compensation, Disclosure and Maintenance of Confidentiality of Material Information and Securities Trading, Risk Management, Related-Party Transactions, in addition to reviewing Internal Regulations of the Board of Directors and the Code of Conduct. These and other Policiesare available at the company's website.

All transactions with related parties are duly assessed and approved by its Executive Board and Board of Directors aiming to ensure that these will be arm's length transactions, i.e., carried out on an independent basis and based on market conditions. As established in Related-PartyTransactions Policy, the disclosure of transactions is made through its periodic financial statements and the Reference Form and, supplementarily, as required by CVM Instruction No. 480/2009.

Additionally, the Statutory Audit Committee is responsible for assessing, monitoring and recommending the Policy correction or improvement to the Management, as well as the procedures to monitor potential conflicts of interest of the company's executives, administrators and shareholders.

As a defensive measure, the Company's Bylaws sets forth that the company's disposal of control, either by means of a single transaction or by consecutive transactions, shall be contracted under the condition precedent or condition subsequent that the acquirer undertakes to launch a Tender Offer (OPA) for the shares issued by the Company held by other AES Brasil shareholders, in compliance with the conditions and terms provided for in the law and regulation in force and Novo Mercado Regulation, aiming to ensure them the equal treatment as that which is provided to the selling controlling shareholder.

The Board of Directors shall express a favorable or contrary statement concerning any tender offer that are intended for the shares issued by the AES Brasil, by means of prior statement with grounds, disclosed within fifteen (15) days after the publication of the tender offer notice, which shall encompass at least (i) the convenience and opportunity of the tender offer as for the interest of AES Brasil and the set of shareholders, including in relation to the price and potential impacts for the liquidity of securities held by them; (ii) the strategic plans disclosed by the offering party in relation to AES Brasil; and (iii) the alternatives for the tender offer acceptance available in the market;

Regarding the protection mechanisms for the CEO and executives, in line with its policy for contracting insurance, the company contracted a Civil Liability insurance policy for Management ("D&O"), under usual market conditions, in order to ensure AES Brasil's management the payment of financial losses arising from claims made due to harmful acts caused to third parties, during the regular exercise of their activities.

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Corporate Governance

Board of Directors

In compliance with the company's Bylaws, the Board of Directorsis composed by at least five and at most eleven effective members, with a term of office of two years, with reelection allowed. In 2023, the average tenure is 1.6 years (considering members of the Board of Directors and the Supervisory Board). As defined in the company's Bylaws and in the Internal Regulations of the Board of Directors, those who meet the independence criteria established in the Novo Mercado will be considered as Independent Directors. AES Brasil's Board of Directors is composed by 11 members, five of whom independent members (45%). Regarding diversity gender, the board is represented by 27% of women. AES Brasil has the WOB (Women on Board) seal, which recognizes organizations with two or more women on the board.

The Board of Directors is responsible for resolving on the sale, lease, assignment, transfer, settlement or other disposition of any of AES Brasil's assets or shareholding at any amount exceeding fifty million Brazilian Reais (R$ 50,000,000.00), except for the following cases:

1. if these are specified in the Annual Business Plan or (b) when related to energy purchase agreements.

As provided for in the Internal Regulations of the Board of Directors, the assessment as a collective body, of its Committees and the Executive Board will be carried out annually and the summary of its results will be disclosed in the company's Annual Report.

As an additional governance practice, advisory committeesto the Board of Directors were created to support on specific matters. The Statutory Audit Committee, Compensation and People Committee and the Sustainability Committee are in operation, the latter being chaired by the company's CEO and counting on the presence of an external expert, as well as an independent member and the Chairman of the Board of Directors.

The Statutory Audit Committee, a permanent advisory body to the Board of Directors, 100% comprised by independent members, has, among other duties, the responsibility of overseeing the risk control and management systems, monitoring the effectiveness and sufficiency of the respective structures, as well as the quality and integrity of its processes, proposing the necessary actions to the Board of Directors.

The Management Appointment and Compensation Policyof AES Brasil establishes the guidelines that shall be followed regarding the appointment of candidates and setting the compensation of the members of the Board of Directors, its Advisory Committees, and the Executive Board (collectively, the "Management"), as well as the members of the Fiscal Council, when in operation. The appointment for joining the Management must consider criteria such as: complementary experience, academic background, availability of time to perform their duties and diversity. The competence matrix presents the wealth and diversification of knowledge of the members of the Board of Directors is available at the company's website.

COMPOSITION OF THE BOARD OF	1Q23	1Q24	2022	2023
DIRECTORS
	Total	11	11	11	11
Members of the Board of
Women	4	3	4	3
Directors
	Men	7	8	7	8
Independent members		4	5	4	5

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