Light : Dados Econômico-Financeiros

MANAGEMENT REPORT- LIGHT S.A.- 2023

Message from the Management

2023 presented Light with an opportunity to confront challenges it has been facing for several years.

As is well known, structural problems in the concession area and the high interest rate environment in Brazil in recent years led the Company to an economic and financial imbalance that culminated in a judicial reorganization process, which began in May.

Despite this situation, Light continued to fulfill its main objective: to guarantee quality energy distribution services for the approximately 12 million people in its concession area, which includes 31 municipalities in the state of Rio de Janeiro.

Light SESA ended 2023 as the 2nd best Distribution business in the country in terms of FEC and the 4th best in terms of DEC, among those with more than 1 million customers. These two indicators from the National Electricity Agency (Aneel) measure, respectively, the frequency and duration of any power interruptions to the consumer.

The Company also remained compliant with all its tax and regulatory obligations, as well as its employees and suppliers. In other words, the normality of its Distribution business was ensured.

In June, aware of its quality and operational vocation and its commitment to society, Light requested the Ministry of Mines and Energy and Aneel to renew its concession, which expires in 2026.

Light wants to continue providing quality services to the people of Rio de Janeiro for many years to come. The city's history of economic, industrial and social development blends with the Company's century-old history of pioneering spirit and entrepreneurship.

Throughout 2023, as a member of Light's executive board, I oversaw the Company's regulatory area and took part in all its strategic discussions.

In January 2024, I assumed the position of CEO of Light SA, with the mission of leading the work to ensure the long-term sustainability of the Company and the Concession. We are seeking conditions for Light to remain operationally, financially and economically healthy. To ensure that the Company continues to be relevant and a leading player on the national stage and in Rio de Janeiro. These conditions should become clearer this year and will be created from the outcome of the two main discussions set forth by the Company in 2023.

In the context of negotiations with creditors, we are pursuing a judicial reorganization plan that will provide Light with financial health and make the Company's recovery feasible, guaranteeing both the payment of its debts and the investments necessary to ensure the quality of the operation. These discussions are progressing, and we believe there will be a solution soon, as the creditors' meeting is scheduled for April 25.

On the other front, Light is still in talks with the Granting Authority to renew the concession through a contract that takes into consideration the most recent industry dynamics and also specific characteristics of Rio de Janeiro, which has experienced a sharp downturn in the market in recent years and where the rate of energy theft is above the national average.

MANAGEMENT REPORT- LIGHT S.A.- 2023

Even under these conditions, Light continues to work hard and has delivered a strong operating result in 2023.

Total collection, excluding energy recovered (REN), reached 97.6% in December/23, an increase of 1.0 p.p. compared to December 2022. The Company's Billed Sales increased by 483 GWh in 2023 to 25,710GWh, driven by residential and commercial consumption, largely impacted by higher temperatures - the 2023 average was 25.4ºC, 1.1ºC higher than in 2022. The heat related consumption increase, particularly in the last quarter of the year, also led to higher non-technical losses, which rose 6.2 p.p. to 64.51%.

The Company's results show the commitment to quality and combating losses not only of management, but also by Light's entire workforce. The dedication of this team is demonstrated by the tireless work done in record time to set up an emergency grid to ensure the energy supply of Ilha do Governador by the beginning of 2024.

Light has deployed around 240 employees to work on the island and has allocated around R$100 million for the complete renovation of the electricity network that serves the region. This year, the estimated investment in the entire concession area exceeds R$ 800 million.

The commitment to high-quality service is on everyone's agenda. And the Company will go to great lengths to guarantee the population a good service. In the last five years, the concessionaire has invested around R$4 billion in maintenance, network expansion and combating losses.

I would like to thank everyone - employees, collaborators, creditors, shareholders, suppliers - for their trust, hard work, and dedication to transforming Light.

Alexandre Nogueira Ferreira

CEO

Corporate Profile

Light is present in 31 of the 92 municipalities in the state of Rio de Janeiro, covering a region of around 11 million people through a network that is approximately 104,500 km long. The Company ended 2023 with around 4.3 million active contracts. Headquartered in the city of Rio de Janeiro, the Light Group is made up of the holding Company, Light S.A. - In Judicial Reorganization, its direct subsidiaries - Light Serviços de Eletricidade S.A. (energy distribution), Light Energia S.A. (energy generation), Lightcom Comercializadora de Energia S.A. (energy commercialization), Light Conecta Ltda. (energy generation and services), Light Soluções em Eletricidade Ltda. (services) and Instituto Light (institutional), Axxiom Soluções Tecnológicas S.A. (IT services). - and by jointly owned subsidiary: Amazônia Energia Participações S.A. (stake in Belo Monte HPP)

Judicial Reorganization

Despite its nationally recognized operation, marked by excellence in the providing of public utility services, and the efforts always made to optimize the Company's obligations and preserve its operations, the Company had been experiencing a complex operational and financial situation, including a high level of debt, historically insufficient cash generation to

MANAGEMENT REPORT- LIGHT S.A.- 2023

honor commitments and the proximity of the end of its concession contract and uncertainties regarding its renewal.

Among the factors contributing to this scenario, we can mention: (a) non-technical losses, which have remained at a significant level, mainly due to the large volume of losses in Severely Restricted Operation Areas (SROAs). SROAs are regions dominated by some form of parallel power, in which the Company is unable to operate in actions to combat losses or delinquency;

1. a decrease in the consumer market of almost 20% since 2014 due to the economic degradation of the concession area; (c) the share of consumers who pay for electricity in Rio de Janeiro has gradually decreased in recent years; (d) the investments made by the Light Group have not had a return in the proportion expected of them; (e) the Company's financial planning was impacted by the law that determined the full return to consumers of tax credits earned after the exclusion of ICMS tax from the PIS/COFINS tax calculation base; and (f) the Covid-19 pandemic, which severely hit the global and domestic markets.

Consequently, on April 10, 2023, Management filed a Preliminary Injunction, through which the enforceability of financial obligations was suspended, as well as the effects of decreeing early maturity or accelerated amortization of debts, among other determinations.

On May 12, 2023, Light S.A. filed the main request for Judicial Reorganization with the 3rd Business Court of the District of Rio de Janeiro, case no. 0843430-58.2023.8.19.0001, a request approved by its Board of Directors and subsequently ratified at the EGM held on June 7th, 2023. On May 15, 2023, the judge of the 3rd Business Court of Rio de Janeiro granted the processing of Light's judicial reorganization.

Although Light SESA and Light Energia are not in judicial recovery, the existence of co- obligation in the debts subject to the restructuring process as well as the need to protect their assets - considering the social aspect of their essential service, the preservation of both companies and the viability of their economic activity - extended the aformentioned protection to the companies only for their mirrored debts, thus not affecting any obligation that is exclusive to the concessionaires, such as sectoral, consumer, labor and others.

On October 10, 2023, the court granted Light S.A. an extension of the stay period and maintained the protection of Light SESA and Light Energia, for a further 180 days, starting on October 12th, 2023, with an expected end date of April 9th, 2024.

Subsequent events:

1. At a meeting held on February 23, 2024, the Board of Directors of Light S.A. approved the revised terms and conditions of the Amended Judicial Reorganization Plan ("Amended JRP"), as well as the presentation of the Amended JRP in the Judicial Reorganization proceedings. As of the date of approval of this document, the Modified Judicial Reorganization Plan has not yet been voted on (approved/denied) at the General Meeting of Creditors and, therefore, has not yet been ratified by the courts.
2. On March 6, 2024, subsidiary Light SESA received an infraction notice issued by ANEEL, in the amount of R$28,394 thousand, for failure to provide adequate services regarding the supply of electricity to consumers in its concession area. The infraction notice is under analysis by our legal advisors, who, as of date, assessed the chance of loss as possible.

MANAGEMENT REPORT- LIGHT S.A.- 2023

Energy Distribution

Operational Performance

Tariff Adjustment

In 2023, on March 14, ANEEL's board of directors approved a tariff adjustment index for its subsidiary Light SESA with an average effect of 7.00%, of which 6.05% for high-voltage customers and 7.40% for low-voltage consumers. The new tariffs came into force on March 15, 2023. This readjustment included the passing on to consumers of tax credits from the exclusion of ICMS tax from the PIS/Cofins base, in the amount of R$1.77 billion, in compliance with Law 14.385/22.

Subsequent event: On March 12, 2024, the National Electric Energy Agency ("ANEEL"), through Decree No. 3,310, approved the tariff readjustment, with an average effect of 3.54%. The new tariffs came into force on March 15, 2024. The average increase for low-voltage customers was 4.05% and for high-voltage customers 2.45%.

Market Evolution

Billed Sales per Segment (GWh)		4Q23	4Q22	Δ%	2023	2022	Δ%
Captive	3,952	3,651	8.2%	15,158	15,188	-0.2%
Residential	2,242	1,905	17.7%		8,297	7,954	4.3%
Commercial	74	90	-18.1%		314	382	-17.7%
Industrial	969	970	-0.1%		3,835	4,008	-4.3%
Other	667	685	-2.7%		2,711	2,845	-4.7%
Grid Usage	2,832	2,575	10.0%	10,847	10,202	6.3%
Commercial	1,194	1,152	3.7%		4,745	4,887	-2.9%
Industrial	919	780	17.8%		3,353	2,981	12.5%
Other	398	284	40.0%		1,381	955	44.6%
Utilities	321	359	-10.7%		1,368	1,380	-0.8%
Total(1)	6,784	6,227	9.0%	26,005	25,391	2.4%

In 2023, the total adjusted Billed Sales market1 rose by 2.4% compared to the same period last year, mainly due to growth in the Residential (+343 GWh) and Commercial (+199 GWh) classes. The higher consumption in the Residential class can be attributed to the higher average temperature in 2023, especially in 4Q23, while in the Free Commercial class, the growth in consumption in the supermarket, transportation and condominium (shopping malls, commercial buildings, etc.) segments stands out.

The average temperature in 2023 was 25.4ºC, 1.1ºC higher than the previous year. Higher temperatures were concentrated in the second half of the year, when the effect of El Niño was more present. In 4Q23, the average temperature was 26.8ºC, an increase of 2.2ºC on the 4Q22 average.

1 Adjusted Billed Sales includes the volume of offset (+443 GWh) and simultaneous (+295 GWh) distributed generation in the Grid Usage segment, class "others" and the adjustment of 742 GWh referring to non-recurring cancellations of REN Terms of Occurrence and Inspection ("TOIs") in 2023.

MANAGEMENT REPORT- LIGHT S.A.- 2023

Energy Losses

In 2023, total ex-REN losses increased by 1,252 GWh compared to the previous year, in line with the increase in Grid Load of 1,972 GWh over the same period. The indicator of total ex- REN losses on Grid Load reached 29.0% in 2023, up by 2.0 p.p. over 2022.

The ex-RENnon-technical losses / reference market (NTL/RM) indicator reached 64.5% for the year, an increase of 6.2 p.p. when compared to 2022. A large part of the increase (854 GWh) can be attributed to higher temperatures. In the year, the NTL/RM indicator was 24.5

1. above the 40.04% mark which is passed on in the tariff according to the parameters defined by ANEEL in the Periodic Tariff Review (RTP) of March 2022. The difference between the actual loss and the regulatory loss in this period generated a negative impact of approximately R$999 million on the Company's EBITDA.

| Total Loss Evolution [GWh] |

12 months

It's worth mentioning that the expansion of Distributed Generation (DG) continues to contribute to the contraction of the Reference Market and, consequently, producing a negative impact on the NTL/RM indicator. In 2023, DG was responsible for reducing the Company's billed sales by approximately 739 GWh (443 GWh of which was compensated energy). Considering this impact on the Reference Market, the NTL/RM indicator was 60.9% in 2023 and 56.4% in 2022.

In line with the strategic review of the Company's loss plan mentioned earlier, there were 327,000 normalizations in the year, 41% less than last year (554,000). As a result, gross REN totaled 96 GWh in 2023, compared to 305 GWh in 2022. The Incorporation of Power (IEN) carried out throughout the year contributed to a total increase of 113 GWh in turnover (compared to 201 GWh in 2022).

In 2023, the Grid Load in Severely Restricted Operation Areas (SROA) totaled 5,110 GWh, equivalent to 14% of the Company's total Grid Load for the year. Non-technical losses in these same locations amounted to 3,554 GWh in the same period, representing 45% of total nontechnical losses in 2023.

MANAGEMENT REPORT- LIGHT S.A.- 2023

Collection

The total collection rate ex-REN (12 months) reached 97.6% in December/23, an increase of

1.0 p.p. compared to the same period in 2022 (96.6%), driven mainly by the Retail segment, which accounts for more than 60% of the Company's collection.

The improvement in the indicator for the retail and large private client segments in recent periods is associated with the reformulation of the collection initiatives implemented by the Company throughout 2023. Due to the high temperatures, especially in 2H23, the Distribution business relocated several teams previously designated to combat delinquency initiatives to attend to incidents with the goal of sustaining the Company's service quality.

| Collection Rate per Segment |

Values exclude REN; 12 months

MANAGEMENT REPORT- LIGHT S.A.- 2023

The delinquency indicator (PECLD) adjusted for non- recurring items over Gross Operating Revenue (12 months) ended December/23 at 4.3%, 0.7 p.p. higher than the adjusted index recorded in December/22.

Quality of Services

Indicator 2023

2022

Limits established by

ANEEL

DEC	6.76	6.32	7.19
FEC	3.00	3.07	4.86

The quality of the services provided by the Distribution business continues to be one of the Company's strategic priorities. Despite all the efforts to recover margins and greater financial sustainability, the Company remains focused on operational improvement, evolving initiatives to modernize networks and substations, as well as maintenance actions, field team management solutions, among other initiatives aimed at delivering a good level of quality.

In 2023, the DEC and FEC indicators met the standards set by the regulator (ANEEL) in the concession contract. Considering the moving average of the last 12 months ended December/23, the DEC indicator remained 0.43 hours below the regulatory limit of 7.19 hours (-6.0%), while the FEC stood 1.86 points below the threshold of 4.86x (-38.3%).

When compared to the previous year, the worsening in the DEC indicator reflects the increase in the number of unscheduled interruptions related to adverse weather conditions, which spread throughout the year and influenced the time taken to restore the service.

Customer Service

In 2023, Light maintained its efforts to continue the evolution of digital channels, seeking improvements in service procedures and processes, as well as the automation of tasks, reports and indicators. These actions allow for more assertive monitoring of the execution of services.

One of the highlights of the Company's digital transformation is the rapid evolution of its relationship with retail customers. By 2022, all customer services were available completely online. Among the solutions implemented, the main services have fully digital flows, validating documents automatically and consulting the Company's systems in real time. In 2023, we strengthened digitalization and invested in making digital channels easier to navigate, which represented a 44% increase in the digitalization of the services prioritized this year, which have the highest volume of demand and opportunities for progress.

MANAGEMENT REPORT- LIGHT S.A.- 2023

The most obvious change occurred in the call center's Audible Response Unit (IVR) in 2022, with the adoption of artificial intelligence technology, even capable of identifying when it is necessary to transfer calls to human agents. In addition to the gains in user experience, the measures brought a leap in productivity and cost reduction. The Company saw a 15% reduction in telephone service, as a result of the digital service boost. Between 2021 and 2023, Light invested R$16 million in digital transformation projects, of which R$7.96 million in 2023.

Available via Whatsapp, Lia, Light's virtual representative, accounted for 10.2 million calls in 2023, an increase over 20%. Its functionalities in the year responded to 19 different types of problems, from warning of a power outage and monitoring services to paying debts in installments.

In 2023, Light's Perceived Quality Satisfaction Index (ISQP) reached 64.7, an improvement of 21.4% compared to 2022. This annual survey, promoted by ABRADEE, aims to find out the satisfaction of urban residential customers in the five areas of operation, which are: energy supply, information and communication, electricity bills, customer service and image. The Company improved its score in all categories and obtained the highest index (79.0) in the "electricity bill" category.

Financial Performance

In 2023, the Distribution business's EBITDA2 was R$1,661 million, an increase of R$3,478 million compared to the negative result of R$1,817 million recorded in 2022. The increase in this indicator can be attributed mainly to the negative impact of non-recurring items recorded in the 2022, including: (i) provisions for the return of PIS/COFINS credits to consumers, in accordance with Law 14.385/22, in the amount of -R$1,081 million; (ii) provision for the revision of delinquency (PECLD) methodologies and estimates in the amount of -R$855 million; (iii) provisions for JEC and Civil contingencies (-R$379 million), among others.

Energy Generation

Operational Performance

Energy Purchase and Sale (MWm)*

2023

2022 Change

2023-22

Free Contracting Environment Sales (ACL)	449	459	-2,2%
Spot Sales (CCEE)	40	34	17,6%
Free Contracting Environment Purchases (ACL)	30	35	-14,3%
Spot Purchases (CCEE)	-	-	-

*These figures include the following power plants: Fontes Nova, Nilo Peçanha, Pereira Passos, Ilha dos Pombos, Santa Branca and PCH Lajes.

In 2023, the volume of sales on the free market (ACL) was 449 MWm, -2.2% compared to 2022, while purchases on the ACL were 30 MWm, -14.3% over the same period. In 2023, the Company maintained the strategy adopted in 2022, which aimed to protect the portfolio from variations in the GSF and energy prices (PLD), allocating its energy offer predominantly in the

2 EBITDA is not a measure recognized by Brazilian Generally Accepted Accounting Principles or IFRS and is used as an additional measure of operating performance. It should not be considered in isolation or as a substitute for Net Income or Operating Income, or as an indicator of operating performance or liquidity. Pursuant to CVM Instruction 527/2012, CVM EBITDA is calculated as net income before income tax and social contribution, financial expenses, net, depreciation and amortization.

MANAGEMENT REPORT- LIGHT S.A.- 2023

second half of the year in accordance with the regulatory limits. The more favorable GSF throughout the year, especially in the second semester, made it possible to increase the allocated energy and thus reducing the need to purchase energy.

Lajes Small Hydroelectric Power Plant

Lajes Energia S.A. commercially operates PCH Lajes, a plant with an installed capacity of 17 MW, which went into commercial operation in July/18.

Financial Perfomance

In 2023, Light Energia's net revenue totaled R$815 million, 1.1% above 2022. EBITDA reached R$667 million, 6.2% higher than the previous year, and net income was R$368 million, a significant increase of 151.6% compared to the same period.

The result can be explained by the improvement in the hydrological scenario over the course of 2023, which led to an increase in the GSF and a drop in energy prices (PLD), reducing energy purchase costs. Light showed great efficiency in its strategy of protecting its results from market risks (GSF/PLD).

Energy Trading

Operational Performance

In 2023, Lightcom sold 523 MWm of energy, 13% less than the 2022 volume of 604 MWm. The variation can be attributed to the end of long-term contracts with end consumers and market agents and the reduction in short-term operations.

Financial Performance

In 2023, Lightcom's net revenue totaled R$1,061 million, 8.6% less than in 2022. EBITDA was R$97 million and Net Income was R$73 million, 12% and 16% higher than in 2022, respectively.

Light S.A. - in Judicial Reorganization

Financial Performance

Net Operating Revenue

Net operating revenue, excluding construction revenue, totaled R$13,476 million in 2023, 11% higher than in 2022. This growth was due both to the increase in revenues from the free market and the positive variation in the account for changes in items in portion A (CVA).

Costs and Expenses

Consolidated operating costs and expenses, excluding construction costs, ended 2023 in the amount of R$11,759 million, 13.7% lower than in 2022. This variation can be explained mainly by the recognition, in 2022, of (i) a provision for the return of PIS/COFINS credits to consumers, in accordance with Law 14.385/22, in the amount of (-R$1,081 million), as well as (ii) a revision

MANAGEMENT REPORT- LIGHT S.A.- 2023

in the methodology and estimate of delinquency (PECLD) (-R$855 million) and (iii) a revision in the methodology and estimate of the provision for civil contingencies, in the amount of (- R$379 million).

EBITDA

In 2023, consolidated EBITDA totaled R$2,325 million, an increase of R$3,504 million when compared to the negative result of R$1,179 million in 2022. The increase can be attributed mainly to the non-recurring events that negatively impacted the 2022 results, including provisions in the amount of -R$2,513 million, referring to (i) the recognition of a provision for the return of PIS/COFINS credits to consumers, in accordance with Law 14. 385/22, in the amount of (-R$1,081 million), (ii) revisions to PECLD methodologies and estimates, in the amount of (-R$855 million), as well as (iii) revisions to methodologies for civil contingencies, in the amount of (-R$379 million).

Additionally, EBTIDA was positively impacted by the growth in the free market, as mentioned, as well as negatively impacted by the increase in Distribution business's PMSO in the amount of R$90.4 million, comparing 2023 vis a vis 2022. The worsening in PMSO is due to the lower capitalization of labor, as well as the increase in costs for emergency response teams.

On the other hand, consolidated EBTIDA was positively impacted by the Generation business's improved results, with the improvement in GSF and lower energy purchase costs.

Net Result

In 2023, Light S.A. reported a net result of R$255 million, R$5,927 million higher than the negative result of -R$5,673 million in 2022. The improvement is mainly due to the non-recurring events in the Distribution segment mentioned above in the EBITDA section, as well as the negative financial impact of the financial restatement of the provision for the return of PIS/COFINS credits to consumers, which negatively impacted financial expenses by -R$1,722 million in 2022.

Indebtedness

The Company's net debt on December 31, 2023, totaled R$9,212 million, an increase of 1.0% compared to 2022 of R$9,032 million.

In terms of gross debt, there was an increase in tender debt, due to the provisioning of interest and monetary correction, mentioned below, which was neutralized by the amortization of the FIDC debt over the course of 2023. As a result, gross debt rose from R$11,129 million to R$11,338 million. in 2023, the Company's cash and cash equivalents stood at R$2,097 million from R$2,084 million in 2022.

It is worth noting that the Company and its subsidiaries Light Serviços de Eletricidade S.A. and Light Energia S.A. have had their enforceability suspended since the Antecedent Provisional Remedy was filed on April 10, 2023, and, therefore, their balances remain frozen within the judicial reorganization process. The Company has made provisions for the interest and monetary restatement that would have been incurred since the request for judicial reorganization, in accordance with the terms and conditions originally provided for in the financial debt contracts now in competition and has reclassified the amounts to current liabilities.