AXIA3

Axia Energia, whose shares are traded on B3 under the tickers AXIA5, AXIA7, AXIA6 and AXIA3, corresponds, in the context of the Reference Form analyzed, to the corporate and operational structure of Centrais Elétricas Brasileiras S.A. – Eletrobras. The company was created from a proposal made in 1954 and was officially incorporated on June 11, 1962, initially as a mixed-capital company. Since its inception, it has been tasked with studying, designing, building and operating power plants, transmission lines and electricity distribution assets, as well as performing the commercial acts resulting from these activities. Over the decades, it has taken on a central role in implementing the country’s electric power policy, especially after the 1960s, when several sector laws reinforced its responsibility for expanding energy supply. Historic milestones include the creation of regional subsidiaries, participation in Itaipu Binacional and its subsequent entry into the distribution segment through the federalization of state-owned concessionaires, which were later privatized between 2018 and 2019 under the National Privatization Program.

The recent trajectory of the company linked to Axia Energia is marked by a broad process of corporate reorganization and change of control. In 2017, the Ministry of Mines and Energy expressed its intention to privatize Eletrobras, resulting in the submission to the National Congress of Bill No. 5,877/2019. In 2022, shareholders approved a capital increase transaction through a public offering of common shares and ADRs, carried out simultaneously in Brazil and the United States, with registration at the CVM and the SEC. The offering led to the dispersion of shareholding control, so that the company ceased to be a mixed-capital company and began to have widely held private capital. This process was accompanied by internal reorganizations, such as the creation of CGT Eletrosul in 2020, the transfer and merger of generation and transmission assets, the merger of Furnas as from July 2024 and the approval, in April 2025, of the merger of Eletropar, with the aim of simplifying the corporate structure and unlocking value levers. There was also a decision to delist the shares from Latibex in 2025, concentrating trading mainly on B3 and the NYSE.

The business model associated with Axia Energia is based on three main fronts: generation, transmission and commercialization of electric power, with some activities related to administration and management of equity interests. The company conducts studies, designs, builds and operates power plants and extensive high- and extra-high-voltage transmission networks, and also enters into power sales contracts in the regulated market and, increasingly, in the free market. It also promotes and supports research in the energy sector, focusing on alternative generation sources, the rational and sustainable use of energy and the implementation of smart grids. In the fiscal year ended December 31, 2024, consolidated net operating revenue reached R$ 40.18 billion, of which 59.69% came from the generation segment and 42.07% from the transmission segment, with a small portion attributed to administrative services and intersegment eliminations. This revenue breakdown highlights the simultaneous relevance of generation and transmission within the group, which positions itself as an integrated electric infrastructure platform.

In the generation area, the company behind tickers AXIA5, AXIA7, AXIA6 and AXIA3 is the largest power generator in Brazil, according to ANEEL data, with an installed capacity of 44,246 MW, representing around 21% of the country’s total installed capacity. In 2024, it operated 87 generation projects – hydro, wind, solar and thermal – across 20 states and the Federal District, including own plants and stakes in special purpose entities. Approximately 97% of installed capacity comes from low greenhouse gas emission sources, reflecting the strong predominance of hydropower generation. This segment alone accounted for R$ 23.98 billion in net revenue in 2024. The company has been adjusting its portfolio, with divestments of specific wind and thermal assets and the start-up of new wind farms, resulting in a net reduction of 408.8 MW in installed capacity in 2024. Hydropower accounts for most of the energy produced, with 47 hydroelectric plants totaling 42,293.49 MW of capacity and representing 95.8% of the energy generated.

In the transmission segment, the company associated with Axia Energia operates the largest transmission line network in the country, with 74,013 km in operation considering own assets and partnerships via SPEs. Of this total, 69,482 km belong to the Basic Grid (voltages equal to or above 230 kV), which corresponds to 36.89% of the National Interconnected System. In addition to the lines, the company is responsible for 264,535 MVA of transformation capacity at its corporate facilities, playing a crucial role in integrating regional systems and evacuating energy generated at large plants, such as the Tucuruí hydroelectric plant in Pará. Transmission activities are highly regulated and based on long-term concessions, with strong revenue predictability, which is reflected in the 42.07% share of this segment in 2024 consolidated net operating revenue, equivalent to R$ 16.9 billion.

The company is also actively engaged in power trading, both in the regulated environment and in the free market. In 2024, 7,353 average MW were traded in the Free Contracting Environment, with the portfolio expanding to 751 customers, 660 of which operating in the free market. The gradual decurtailment of quotas from its hydroelectric plants allows the company to direct a growing portion of its energy to market contracts, including retail, following a bylaws amendment approved at a 2025 shareholders’ meeting that detailed its activities as a retail energy supplier. This is accompanied by strategic partnerships to expand its presence in the free market, aligned with the strategy of being a comprehensive platform for renewable energy solutions. The company also provides administrative services, including group cash management and business administration in SPEs, although this front represents a small share of total revenue.

From a geographic and corporate standpoint, Axia Energia reflects an organization with a presence in all regions of Brazil, through operating subsidiaries such as Eletronorte, CGT Eletrosul and Chesf, in addition to an extensive network of equity interests. As of December 31, 2024, it held interests in 63 special purpose entities – 62 in Brazil and one abroad – grouped into clusters of transmission and hydro, wind and solar generation, as well as 18 associates. Even so, all of 2024 net operating revenue, totaling R$ 40.18 billion, was attributed to Brazil, with no material revenue from abroad. In 2025, shareholders approved the merger of Eletropar, reinforcing the strategy of consolidation and corporate simplification, focusing on efficient capital allocation and reducing intermediate structures.

The company’s operations are strongly conditioned by state regulation of the Brazilian power sector. Its generation, transmission and commercialization activities depend on concessions, authorizations and licenses granted by the granting authority, with a central role played by the Ministry of Mines and Energy and the Brazilian Electricity Regulatory Agency (ANEEL). The company is subject to the General Concessions Law, Law No. 9,074/1995 and Law No. 10,848/2004, which structured the current sector model by separating the Regulated Contracting Environment and the Free Contracting Environment. Bodies such as the National Council for Energy Policy, the National System Operator, the Power Trading Chamber, the Energy Research Company and the Electric Sector Monitoring Committee complement the institutional framework. Concessions may be subject to interventions, tariff reviews and penalties, including fines of up to 2% of net operating revenue, which makes regulatory management a critical factor for operations and earnings visibility.

With regard to environmental, social and governance (ESG) aspects, Axia Energia is associated with a structure that publishes a consolidated Annual Report, covering the holding company, operating subsidiaries and certain wholly owned SPEs. The report follows international transparency and sustainability standards, such as GRI standards, the IIRC Integrated Reporting framework, World Economic Forum metrics, SASB guidelines, TCFD recommendations, the UN Global Compact principles and the ANEEL Electric Power Sector Accounting Manual. Both the Annual Report and the GHG Emissions Inventory have been assured by independent auditors since 2010 and 2012, respectively. The company uses a materiality matrix updated every two years based on stakeholder consultations, using the double materiality concept to identify material topics such as climate change and energy transition, biodiversity, water resource management, relations with communities and customers, ethics and compliance, worker health and safety, innovation, talent attraction and retention, and government relations. These topics guide ESG performance indicators, including safety metrics that directly affect variable compensation for leadership, reinforcing the integration between socio-environmental risk management and corporate governance.