November 9, 2005November 9, 2005

3rd quarter 2005 Results3rd quarter 2005 Results

• Market

• Tariff Adjustment

• Financial and Operating

Performance

• Debt Profile

• Highlights

• Tariff Adjustment

• Operating Performance

• Financial Performance

Conclusion

4

HighlightsHighlights of of thethe quarterquarter

• Due to non-recurring events, Eletropaulo reported a loss of R$ 324.1 million in 3Q05, compared to a net income of R$ 136.8 million in 2Q05

• Tariff Adjustment of 2.12%, effective as of July 4, 2005

• R$ 800 million debentures issued in September

5

Profile of Consumer Market Profile of Consumer Market

32.8%

25.0%

25.8%

7.9%8.5%

3Q04 - GWh 3Q05 - GWh

33.0%

20.8%

25.2%

6.7%

14.3%

40.8%

21.3%

29.0%

1.9%6.9%

41.2%

19.9%

3.7%

29.0%

6.2%

3Q04 – R$ 3Q05 – R$

cons

umpt

ion

reve

nue

Residential

Industrial

Commercial

Others

TUSD

Consumption- GWh

1800.0

2200.0

2600.0

3000.0

1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05

6

Comparison of Consumption in Comparison of Consumption in GWhGWh

NOTE: Charts do not consider own consumption

4.7%

-13.1%1.7%

-12.4%

8,081

8,831

9,194

7,882

Market Billed Market Billed with TUSD

3Q04 3Q05

74.9%

4.1%

-2.5%

750700

2,2812,204

2,896

1,312

613

2,3201,915

3,033

Residen

tial

Industrial

Commercial

Others

TUSD

3Q04 3Q05

7

Retention of Potentially Free ConsumersRetention of Potentially Free Consumers

3.1%

13.4%

83.5%

Captive Consumers Free Consumers Potentially Free Consumers

Captive Consumers X Free% total load of concession area predicted to 2005 36,511 GWh

Net Revenues with TUSD - R$ million

1930

3848

54

7884

1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05

8

3.7%6.3% 4.5% 2.5% 3.6% 4.8%

7.5%7.6% 12.1%

11.8% 7.3%1.6%

-4.3%1.7%

16.9%7.1%

-10%

-5%

0%

5%

10%

15%

20%

1999 2000 2001 2002 2003 2004 2005

Parcel B Parcel A PIS/COFINS IGPM

Tariff EvolutionTariff Evolution

Adjustment

2.12%

6.4%

X Factor = 2.43%

18.6%

11.6%

14.3%17.6%

11.1%

13.8%

9

R$ 9,885R 8,275Gross remuneration base

R$ 42TOTAL

R$ 99R$ 426R$ 327Depreciation

R$ 4,771R$5,242net remuneration base

(R$ 81)R$ 814R$ 895Remuneration

R$ 24R$ 24-Additional O&M costs

4.31%3.95%Depreciation rate

17.07%17.07%Remuneration rate

VariationPresentPreviousItem – R$ thousand

Completion of Tariff Review 2003Completion of Tariff Review 2003

• Authorized increase in adjustment rate from 10.95% to 11.65%• R$ 42 million added to the remuneration granted for tariff year 2003-2004

• Restated amounted total R$ 106.9 million, with an impact on 2Q05results

• Recovery of resources will take place during tariff year 2005-2006

R$ 42

R$ 106.9

10

An allowance for doubtful debts of R$ 346.4 million, based on an agreement signed with the MGSP

Increase of 10% in Personnel Expenses due to Collective Bargaining Agreement that increased salaries by 8%

An increase of 12.2% in expenses for CCC due to the increase in the tariff quota for the tariff adjustment of July-2005 and the initiation of amortization of CVA for 2004-2005

3Q04 3Q05

Net Revenue 2,050.3

Operating Expenses (1,725.2)

Adjusted EBITDA 499.1

Financial Income(Expenses)*

(174.3)

Extraordinary Items NetOf Tax Effects

Net Income (Loss) (6.4) (324.1)

1,977.1

(2,079.0)

400.3

(136.2)

Results Results –– 3Q04 x 3Q053Q04 x 3Q05The deferral of the Pis/Cofins taxes increase during the third quarter of 2004 resulted, at that time, in revenues of R$ 117.7 millionThe reversal of the revenue of the energy that was not billed, amounting to R$ 17.8 million in 3Q05, compared to a revenue of R$ 48.8 million in 3Q04, due to:

Migration of clients to the free marketDifference in the amount of un-billed days Classification of non-billed TUSD of R$ 31.7 million

as “ use of the energy grid”The start of the amortization of the regulatory asset of R$ 106.9 million, resulting from the recognition of costs and the remuneration base included in the Tariff Review –2003

increase in operating expenses, coupled with the reduction in net revenues.

reversal of the R$ 55.2 million adjustment in the present value of the “other financial expenses” account in 3Q05, resulting from the provision of credits from MGSP

increase in operating expenses and reduction in net revenues

-21.8%

-5,003.4%

(*) Considering consolidated results

R$ milion

-3.6%

20.5%

(85.0) (85.0) -0.1% CVM 371

EBITDA 392.3 (27.5) N.M.

-19.8%

11

2Q05 3Q05

Net Revenue

Operating Expenses

Adjusted EBITDA

Financial Income

(Expenses)*

Extraordinary Items Net

Of Tax Effects

Net Income (loss) 136.8

2,275.5

(1,777.8)

599.3

(77.9)

(85.0)

Results Results –– 2Q05 x 3Q052Q05 x 3Q05

Completion of Tariff Review 2003, which generated an additional revenue of R$ 106.9 million on 2Q05, whose amortization started in 3Q05Reversal of PIS/PASEP’s allowances in the amount of R$ 72.0 million in 2Q05 which had an accounting and non-recurring effect

A non-recurring allowance for doubtful debts of R$ 346.4 million, based on an agreement signed with the MGSP

An increase of 13.2% in expenses for CCC and 10.6% in expenses for CDE due to the increase in the tariff quota on July-2005 tariff adjustment and to the initiation of CVA 2004-2005 amortization

increase in operating expenses, coupled with the reduction in net revenues

smaller appreciation of the Real against the US dollar in 3Q05, of 5.5% versus an appreciation of 11.8% during the previous quarter reduced by 69% the 2Q05 positive impact in “monetary variations in foreign currency”Reversal of PIS/PASEP’s accounting expense of R$ 98.0 million in 2Q05

increase in operating expenses and reduction in net revenuesIncrease in financial expenses

74.9%

N.M.

(*) Considering consolidated results

R$ million

(324.1)

1,977.1

(2,079.0)

400.3

(136.2)

(85.0)

17.0%

-13.1%

0.0%CVM 371

EBITDA 571.6 N.M.(27.5)

-33.2%

12

Negative Impacts Negative Impacts –– 3Q053Q05

Provision - Agreement signed with MGSP R$ thousandMGSP debt balance provision (346.369)Financial Expenses - Present Value Adjustment Reversal 55.227Tax Effects (34%) - Credit 98.988Reversal of Tax Credit (36.143)

Net Effect on the Result (228.297)

increase in Pis/Cofins' taxes - Agreement with AES Tietê R$ thousandPis/Cofins payment to AES Tietê (43.692)Tax Effects (34%) - Credit 14.855

Net Effect on the Result (28.837)

Other impacts - 3Q05 R$ thousandAllowance for doubtful debts - Other Municipal Governments (23.953)Present Value Adjustment - Other Municipal Governments (9.102)IPTU tax – MGSP – Monetary Correction (9.444)Diferred Amortization - Debt downpayment (15.992)Tax Effects (34%) - Credit 19.887Reversal of Tax Credit (14.810)Net Effect on the Result (53.414)

Total - Net Effect on the Result (310.548)

13

EBITDA

Adjusted EBITDA

Debt Confession IIa(CESP Foundation)

3Q05

33.2% Decrease

Adjusted EBITDA

RTE

R$ (27.5)

R$ 12.1

R$ 400.3

R$ 85.3

Adjusted EBITDA Adjusted EBITDA R$ millionR$ million

EBITDA

Debt Confession IIa(CESP Foundation)

2Q05

RTE

R$ 571.6

R$ 15.7

R$ 599.3

R$ 84.0

PIS – accounting reversalR$ 0PIS – accounting

reversalR$ (72.0)

Provision - MGSPR$ 0 Provision - MGSPR$ 330.5

14

186

370

203

297

33

3236

2003 2004 9 months 2005

Capex Self Financed

Total 73

Total Recorded 95

Capex – 3Q05

33

6

Loss Recovery 5

Personnel 17

Others 13

Customer Service and System Expansion

Maintenance

Self Financed 21

CAPEX 3Q05 CAPEX 3Q05 R$ millionR$ million

15

Consolidated IndebtednessConsolidated IndebtednessR$ millionR$ million

71%

23% 26%

29%

77% 74%

0%

50%

100%

2003 2004 3Q05

ST LT

1,424.51,778.8 1,992.6

762.5

1,102.0 948.6

2,338.62,402.73,090.8

2003 2004 3Q05

FCESP CVA/RTE Private Creditors

5,278 5,284 5,280 5,278 5,284 5,280

ST ST vsvs LTLT Debt EvolutionDebt Evolution

16

Hedging StrategyHedging Strategy

0%10%20%30%40%50%60%70%80%90%

100%

2000 2001 2002 2003 2004 3Q05

Local Currency Hedge Foreign Currency

41%

41%

18% 14%

61%

25%

42%

4%

54%

3%

35%

62%

17%

83%

86% of foreign currency debt is

hedged, considering the financial costs

R$3,473 R$4,490 R$5,902 R$5,278 R$5,284

million

8%

90%

R$5,2802%

17

469

70335

522367

1,972

159

132

905

506

474

144

444

43

99

56

158285

9349

Downpayments** 9 months 4Q05 2006 2007 2008 2009 2010-17

R$ BNDES US$ *

Amortization ScheduleAmortization ScheduleR$ millionR$ million

Effective payments

* Conversion rate on 09/30/2005 US$ 1,00 = R$2,2222

** Amortization of debts with creditors included in the Company’s Debt Reprofile Agreement, paid on 01/12/2005 with the third tranche of the rationing loan

Amortization of debts with creditors included in the Company’s Debt Reprofile Agreement, paid in two installments: R$ 175.9 million on 06/29/2005, plus US$ 25.6 million on 07/28/2005 using 50% of the proceeds from the R$ 474.1 million bond issue

Amortization of debts with creditors included in the Company’s Debt Reprofile Agreement, paid in two installments: R$ 550.1 million paid on 09/27/2005, and US$ 75.2 million paid on 10/27/2005 using 90% of the proceeds from the R$ 800.0 million issue of debentures.

18

BONDS (June 2005)

• Principal: R$ 474 million

• Tenor: 5 years

• Interest rate: 19.125% p.a.

• Interest and Amortization:

• bullet

• semiannual interest

Debentures (September 2005)

• Principal: R$ 800 million

• Tenor: 5 years

• Interest rate: CDI +2.90% p.a.

• Interest and Amortization:

• Semiannual interest

• Grace period: 23 months

• Annual payments

• Down payments made to creditor banks:

• Bonds: 50% R$237,030,000

• Debentures: 90% R$720,000,000

2005 Issues2005 Issues

2.75 years1.58 yearsDuration

126% CDI128% CDIAverage Cost

After issues

Before issues

Private Creditors debt

Basis: September 2005

19

ConclusionConclusion

• The R$ 324 million loss in 3Q05 is due mainly to non-recurring events

• The issue of R$ 800 million in debentures generated:

• A down payment to private creditors with 90% of the proceeds

• A reduction of debt’s average cost and an increase of debt’s duration

• A reduction of foreign currency debt

• Completion of Tariff Review 2003 and PIS/COFINS taxes expunged from the tariff adjustment’s formula.

Financial Strategy:

• Increase duration and decrease costs of debt by substitution of existing debt for new attractive borrowings, considering opportunities in the Stock Market.

20

21

Highlights for the QuarterHighlights for the Quarter

Reversal of provision (PIS/Cofins)On September 30, AES Eletropaulo paid R$ 43.7 million to AES Tietê regarding the increase of PIS and Cofins tax rates incurring on the bilateral contract from July/2004 though June/2005. AES Tietê reversed the provision recorded during this period

Payment of dividendsOn September 27, AES Tietê distributed dividends in the amount of R$ 199.8 million, representing a pay-out of 95.0% on net income for the first half of 2005

Reward – Human ResourcesAES Tietê was considered by “Valor Econômico” newspaper, one of the leading companies in “ Humans Management”

Reward – EnvironmentAES Tietê´s reforesting program of reservoir borders was rewarded in the “3rd Benchmarking Brasileiro” organized by “Mais Projetos Sócio-Ambientais” as the 2nd best pogram

22

Tariff AdjustmentTariff Adjustment

The Initial Contracts are readjusted annually according to the following pre-established formula :

The Bilateral Contract with Eletropaulo is adjusted each July according to the IGP-M (general price index - market) variation

Tariff Readjustment Ratio = VPA + VPB x IGP-MRevenue

Tariff after adjustment(R$ / MWh)

Initial ContractsBragantina February 12.4% 65.30Nacional February 12.4% 69.42CPFL April 10.6% 73.76AES Eletropaulo July 9.0% 75.99Elektro August 5.3% 61.68Bandeirante October 1.4% 72.77Piratininga October 1.5% 72.81BilateralAES Eletropaulo July 7.1% 132.73

Company Month of Adjustment

% of adjustment

Average Tariff – R$/ MWh

119.2

94.4

73.6

54.0

20

40

60

80

100

120

140

2002 2003 2004 9M05

23

Caconde305.2

Euclides410.2

Limoeiro119.8

Ibitinga492.4

Bariri442.3

Barra Bonita399.6

Água Vermelha5,870.1

Promissão764.6

Nova Avanhandava1,031.4

Mogi Guaçu27.9

Bandeirante222.6

Piratininga218.1

Nacional71.6

Bragantina110.4

Elektro360.8

Eletropaulo - CI686.1

CPFL421.0

Eletropaulo - Bilateral6,140.7

Energy Balance Energy Balance –– 9M059M05

MRE / CCEE

Energy Generation x Billed Energyin MWh

*After deducting own consumption and transmission losses, the difference is addressed to the Energy Reallocation Mechanism – MREand Chamber of Energy Marketing – CCEE.

Tietê generated 19.5% above its assured energy

TOTAL

9,864.5

BILLED

8,231.3

1.3%

4.4%

5.1%

2.7%

0.9%

2.7%

8.3%

74.6%

59.5%

1.2%

3.1%

4.2%

4.1%

4.5%

5.0%

7.8%

10.5%

0.3%

1,633.3*

24

107%109%98%

81%

117%123%120%123% 120%

0

500

1,000

1,500

2,000

1997 1998 1999 2000 2001 2002 2003 2004 9M05

Generation - MW Average Generation / Assured Energy

Assured EnergyAssured Energy

AES Tietê has an Assured Energy of 1,275 MW average

During the last 20 years, AES Tietê has generated, in average, 18% above the Assured Energy

The Assured Energy was expected to be revised in 2004, but this revision was postponed to 2014 by the Ministry of Mines and Energy

Generation – MW Average

1.275

25

Stored EnergyStored Energy

The energy storage levels in the Southeast region are comfortable in comparison of the risk aversion curve

0

20

40

60

80

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

t

Oct

Nov

Dec

% d

a En

er. A

rm. M

áx.

2005 2004 2003

2002 2001 2000

0

20

40

60

80

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sept

Oct

Nov

Dec

% d

a En

er. A

rm. M

áx.

2005Risk-averse curve - 2005 Risk-averse curve* - 2006

Risk-Averse Curve Historical

Source: Operador Nacional do Sistema – Oct/05

Supply x Demand – GW Average

Source: Apine

Source: Operador Nacional do Sistema – Oct/05

64.2

46.3 48.6 50.8 53.4 56.560.4

64.2

54.5 56.6 58.5 60.4 61.7 63.9

2005* 2006* 2007* 2008* 2009* 2010* 2011*

Demand Supply

60,854,251,649,347,144,141,8

57,456,555,452,850,450,149,156,5 56,5

2003 2004 2005* 2006* 2007* 2008* 2009* 2010*

Demand Supply

*Forecast - Source: IBP – Insituto Brasileiro do Petróleo

26

Income StatementIncome Statement

Net Revenue 21.4%

Operating Expenses 5.8%

Ebitda 25.1%

Financial Expenses - 68.8%

Net Income

Lower variation of the IGP-M index, from 10.3% in 9M04 to 0.2% in 9M05 Increase in financial income, due to a greater cash balance and increased interest rates

Increase in the Financial Compensation for Use of Water Resources in 29.5%Operating provisions – R$ 18.3 mi

Initial Contracts were adjusted in 8.1%, in average larger volume of energy sold through the bilateral contract –increase from 4,0 GWh to 6.1 GWhR$ 50.5 mi = reversal of the provision regarding the bilateral contract and the recognition of regulatory asset regarding losses on the initial contracts (Pis/Cofins rate increase)

9M04in R$ million

899.4

(213.3)

734.1

(68.9)

411.1 95.8% Net income increase due to better operating and financial performance

9M05

740.9

(201.6)

587.0

(221.1)

209.9

Ebitda Margin 81.6%79.2%

Net Margin 45.7%28.3%

27

Operating Costs and ExpensesOperating Costs and Expenses

End of the obligation of payment of the Public Asset Tax (UBP) in 2004 InsurancesWaterwaysR&D

23.7

16.8

34.9

37.9

18.1

48.0

18.3

15.5

213.3

End of energy purchase from ItaipuR$ 7.3 million relative to "Financial Surplus" MAE expense, which was accounted in 1Q04

in R$ million 9M059M04

Increase of Reference Tariff – TAR, to R$ 52,67MW/h in 1Q05 (TAR x 6.75% x Generated Energy) Increase in the volume of energy generated

Decrease in connection charges established by AneelIncrease in transmission costs due to greater volume of energy sold under the bilateral contract

Provision for loss of financial investments held at BancoSantos ( R$16.9 mi recorded in 1Q05)

21.0

15.5

27.0

34.0

29.8

47.7

0

26.8

201.6

Personnel

Outsourced Services

Financial Compensation

Connection and Distrib.Network Charges

Purchased Power

Depreciation andAmortization

Operating Provisions

Others

Total

8.25% in payroll increase resulting from the collective bargain

12.9%

29.3%

11.5%

- 39.3%

n.a

- 42.0%

28

1.41.3

1.1 1.00.9

2002 2003 2004 9M04 9M05

IndebtednessIndebtedness

Eletrobrás Debt – Flow of Payment – R$ million

-11%

-18%-12%

Net Debt – R$ billion

39137 152 168 185 205 226 250

11225

139 125 109 91 71 49 25

3

0

50

100

150

200

250

300

4Q05 2006 2007 2008 2009 2010 2011 2012 2013

Principal Interest

Creditor Amount - R$ million Maturity Terms Collateral

Eletrobras 1,472.7 May-13 IGP-M + 10% p.a. ReceivablesFunCesp II 0.9 Nov-05 TR + 8% p.a. Receivables

FunCesp III 19.8 Nov-17 IGP-DI + 6% p.a. Receivables

29

Capital ExpendituresCapital Expenditures

Capex 9M05: R$ 13.9 million for equipments modernization, enviromental and waterway improvement

Main Capex destination:Bariri - re-equipping and modernization of the Generating Unit 2

Reforestation of boarders – Ibitinga, Bariri, Barra Bonita and Promissão

Improvement of the waterway

Capex – 9M05Capex – R$ milhões

25,0

17,7

37,530,5

12,4

21,913,9

2000 2001 2002 2003 2004 9M05 2005ForecastRevised Equipment

WaterwayEnvironmentalOthers

57%

14%8%

21%

30

Financial InvestmentsFinancial Investments

Financial investments are distributed as shown in the graphic below:

Foreign Bonds (US$) - Aa1

7%

Private Bonds - A31%

Foreign Bonds (US$) - Aa3

8%BR Federal Bonds - Ba3

84%

31

AES Tietê vs. Ibovespa - Out/04 a Set/05(Base 100 = 10/01/04)

80

100

120

140

160

180

Oct-04 Dec-04 Feb-05 Apr-05 Jun-05 Aug-05

GETI3 GETI4 Ibovespa

171

152

133

Oct-05

End of Secondary Offer

Capital MarketsCapital Markets

In the last 12 months GETI4 shares rose 71.0%, while the GETI3 shares appreciated by 52.3% and the Bovespa Index rose 32.8% in the same period.

After the conclusion of the secondary public offer, there was a significant increase in liquidity. The average daily trading volume of GETI4 shares went from R$ 336 thousand in 3Q04 to R$ 2.223 million in 3Q05, representing an increase of 562%. GETI3 shares experienced a similar trend: from an average daily trading volume of R$ 959 thousand in 3Q04, to R$ 1.949 million in 3Q05, a rise of 103%.

32

Capital MarketsCapital Markets

-

1.000,0

2.000,0

3.000,0

4.000,0

5.000,0

jun-

99

dez-

99

jun-

00

dez-

00

jun-

01

dez-

01

jun-

02

dez-

02

jun-

03

dez-

03

jun-

04

dez-

04

jun-

05

R$ 546 millionCesp spin-off –

Tietê was created

R$ 1.4 billionBrasiliana was

created as part of AES and BNDES

agreement

R$ 2.1 billionNew Model Law was

published

R$ 3.6 billionSecondary Offering Santander/Banespae Nossa Caixa sold

their interest in Tietê

R$ 846 millionAES acquired

Tietê at Privatization

Auction

Tietê’s Market Cap since the privatization:

33

ConclusionConclusion

AES Tietê ended up the 9M05 with highly positive results, highlighting:

Ebitda of R$ 734.1 million, 25.1% above the 9M04, and Ebitda margin of 81.6%.

Net profit amounted to R$ 411.1 million, with a 95.8% increase due to the better operating, financial results and the reversion of Pis/Cofinsprovision.

Net margin increased from 28.3% in 9M4 to 45.7% in 9M05.

November 9, 2005November 9, 20053rd quarter 2005 Results3rd quarter 2005 Results

All statements contained in this presentation related to the outlook of the Companies’ business, projections of operational and financial results, and potential growth represent mere provisions and were based on managements expectations in relation to the future of the Companies. These expectations are highly dependent of market changes, Brazil’s economic outcome, the energy sector and the international markets behavior, being thus subject to change.