Operator:

Good afternoon, ladies and gentlemen. Welcome to the Light's 2Q14 Earnings Conference Call.
Today we have with us, Mr. Paulo Roberto Ribeiro Pinto, CEO and Mr. Joao Batista Zolini
Carneiro, CFO and Investor Relations Officer. Today's live webcast and presentation may be
accessed through Light website at http://www.light.com.br.

We would like to inform you that this event is recorded and all participants will be listen-only
mode. After Light's remarks, there will be a question and answer session. If you need any
assistance during the call, please press *0 to reach the operator. Before proceeding, let me
mention that forward-looking statements are based on the beliefs and assumptions of Light
management on information currently available to the company. They involve risks and
uncertainties because they relate to future events and therefore depend on circumstances
that may or may not occur. Investors should understand that general economic conditions,
industry conditions and other operating factors could also affect the future results of Light and
could cause results to differ materially from those expressed in such forward-looking
statements.

Now, I will turn the conference over to Mr. Paulo Pinto who will begin the conference. Sir, you
have the floor.

Paulo Roberto Ribeiro Pinto:

I welcome you to this conference call. And we have here present, apart from me, Mr. Joao
Batista Zolini, our Logistics Manager and Ricardo Rossi, Superintendent of the Corporate Area
also enriching our presentation. Well, very rapidly, we have here the results of the 2Q and
there was a drop in relation to last year. We have here results that are lower in relation to the
previous year evidently. The greatest impact in this result has to do with the tariffs that we
were able to charge during the year.

Last year, we had better results in the distribution companies. This year, has been a more
difficult year for distribution companies. The deficit in the 1H for Light represented R$1.601
million, this is the net revenue, and we are working on this. We still have R$270 million. That
result helped in this drop.

Different from this issue that is not manageable, you will see during the presentation an
improvement in the operations. We had an improvement in quality indicators, also revenue,
and most important item is the work we have done to fight losses, reducing losses and thus
reaching the golden accordance with the regulating agency as of the last tariff improvement.

Here we had a growth of 5.5% in this quarter, 3%, a larger greater revenue. Here we have a
reduction in the losses and a recovery in the revenue. Also we can also see here based on the
numbers and the operating performance on those items that are manageable, we can see that
we have had a satisfactory performance in those things that are manageable.

We have one more important point. We can see here quality, fighting losses, revenue, these
are positive items, and also the development of our state, and all of these actions have been
the essential factors for the better operational performance of Light.

I would like to insist here on the issue of tariffs, prices, we have made an effort with the
government to have an improvement in the tariffs and we have had an impact on results and
there is a hydrological risk due to the contract and quarters we have. And we also have the
spot market and all of this generated this deficit. Our expectation is that by the end of the year
we will find a global solution for this deficit in tariffs.

But in June, we have these results with this negative impact due to these factors. Then, we
have a project of 70.5 megawatts that was a project that Light already had and we are working
with the regulating agency not only to make our PCH and help facilitate the negotiations and
financing for our investments.

In the 1H we had this, it is an important project. It increases the potential for the supply of
water to Rio de Janeiro. So in a general way, I would like to leave this message, we have a part
with the issues that are manageable and the part that is not manageable and we have
expectations that solutions will be found until the end of the year.

And thus, we continue presenting our results, we hope they will be better every year with the
efforts of the Company, its shareholders, all the Board of Directors.

I will pass the floor to our Director, Zolini who will make a presentation and then, we will be
available for clarifications.

Joao Batista Zolini Carneiro:

Good afternoon. Let us continue with the presentation in our traditional way, beginning with
the highlights. I would like to stress the points that our CEO mentioned, our energy
consumption grew 3% in the 2Q, in comparison with the 2Q of last year, especially due to the
residential segment. We had an increase in consumption, 8% consumption increase in the
residential sector.

Then, we had a rise in the 1Q in consumption due to the temperature and now there has been
a reduction. So, we reduced it by 0.5% getting to 41.9% non-technical losses. In comparison
with June last year, we had a drop of 2.3% in non-technical losses. Collections fees in the
quarter reached 103.5%, 7% down year over year.

Also PCLD, allowance for doubtful accounts, 1.7% of revenue, we have a constant
improvement and we closed the quarter with 1.7% of revenue in doubtful accounts, and 0.8%
down on PCLD of 2.5% recorded in the 2Q13. Also an improvement in DEC and FEC in the last
12 years, based on the work we have, and the improvement was 26.21% in DEC, and 16.91% in
terms of the frequency of cancellations, respectively.

Net revenue grew 1.4% in the quarter totaling R$1,601 million. Consolidated EBITDA in the
2Q14, R$239.3 million, 13.9% down in relation to the 2Q13, especially due to the energy
problems that we will cover later on. Net income for the 2Q, R$15.3 million, compared to a net
income of r$58.2 million in the 2Q13. Consolidated net debt R$5,229.6 million, 2.1% down on
the same quarter last year.

Energy development account transfer of funds to distribution companies, we transferred
R$224.3 million in April and May and this was recorded as, in profit or loss, as cost reduction
with Portion A. I would like to mention that June is not being shown, because it was zero in
reality.

We compensated the costs for the availability in June. So we did not receive anything from the
Electricity Chamber of Trade. Total transfer, R$1.385 million in the 1H, reducing its period tariff
deficit to R$250 million, which will be passed on to consumers in the next tariff adjustment
through the CVA, when we have price increases.

Now the next slide here, we show the evolution of the market. In the last quarter, an average
growth of 4.6% a year, 3% growth in this quarter in relation to the same quarter last year. And
also, we can also see a reduction in the temperature that you can see the curve in the graph,
the reduction in the temperature. Here, residential continues with 32.8%, and also commercial
at 27.6%. Other captives 14% pre-market represent 20.3% of total consumption billed by the
Company.

In the next slide, we see the evolution of the market. Now based on this semester, we had high
temperatures here. You can see in the graph, in the yellow line, 25.7 degree centigrade, and
here you can see the growth 5.5% and the average of the last semester is 5.1% a year.

In the next slide, we have electricity consumption. Here we have residential, 8%, commercial
2.8%, industrial here, -3% due to the macroeconomic situation, the behavior, the drop in the
industry, but on average 2.3% and 3%.

In the next slide, the same vision of the semester, 11% is the growth in residential here due to
the temperature. Commercial, also a growth of 5.7% in relation to the same period last year.
And the industrial here, we see a drop 2.6% and the consumption from industry, the others
growing 4.2% with a total growth average of 5.5%.

Here we have collection rate by segment, by quarter and although we had a small drop, our
collection is here superior to 100%. But retail, which is most of our billing has had growth,
105% collection in relation to 104.5% last year. So, in large clients here we see a drop, we have
had this for some years and here 102% last year and here we see this year's numbers.

In the next page, we see loss prevention. We see the drop in the losses in the various quarters.
The exception was the 1Q that had an increase of 0.2%, and then, we see once again an
improvement, getting to 41.9% or we see a drop in relation to the last semester. Also to the
right, we see the installed meters in thousands of units, and we had a drop in losses, 2.3%. So,
here we have 116,000 in shanty towns.

Here in the next slide, we see the main areas where we are fighting losses. Here we see
continuous improvement in the 22 areas. Here we see a reduction in the losses and also
collections have gone up from 89% to 96% and non-technical losses; before, 50% and current,
20%. Here we have the numbers. We have therefore problems in 12%. Here you can see that
losses are 10%, 11%.

In the next slide, the evolution of revenue. Quarter after quarter we see a growth of 11.5%,
and thus we have these results. So, 3.5% from 2Q13 to 2Q14. Net revenue, here we have
commercialization here of 42.6% in captive. We can see that residential has a larger
percentage, 42% here.

In the next slide, we have the evolution of costs and expenses. I would like to stress here, our
drop with a 16.2% reduction between 2013, 2014. Here we see the contingencies non-
recurring things, but we can see that the PCLD had 26% reduction, 21% semester after-
semester. We have seen a constant reduction improving our results.

Here we have a summary of the impacts of the so-called tariff deficits. In the semester, the
non-manageable costs have not been recovered. So, here we have R$1.6 million non-covered
by the tariffs. And we had R$1,385 million. Here you can see this is due to the hydrological
risks, the auctions, where we bought electricity at higher rates than the ones foreseen in our
expenses.

In the next slide, we see EBITDA. The participation of generation is here in light blue. We see
the generation in the 1Q as a result of sales in the spot market. We had almost 45%
participation. So it is temporary, but in the quarter we saw also 46% participation in
generation contributing for EBITDA. On the chart, we see the evolution of the margin, EBITDA
margin went from 76% to 75.9% in the 2Q and also 79% including all the positive results of the
1Q.

Here in the next slide, we have a view of the quarterly EBITDA, quarterly adjusted, and without
assets and liabilities we have in blue in the internal columns, we see the evolution of EBITDA as
R$278 million, and a reduction to R$239 million, especially due to non-manageable costs.

If we look at the blue columns including assets and liabilities, we have a negative evolution of
R$397 million to R$360 million, as a result of some costs that are non-manageable costs.

In the next slide, we have the same view concerning the semester. Here a reduction to the
EBITDA, a reduction of 6.9% and with CVA 9.3%. We must stress that one thing that had a
great impact and explains most of the reduction in EBITDA was the new events that we had.

Light was the last to come into the third tariff cycle, and we went to work a remuneration of
7.5%. This explains most of the reduction in the consolidated EBITDA. In the same way in net
income, we have the same impact. Profit suffered 73.8% negative and a reduction of 30.8% as
you can see.

In the next slide we see net income, adjusted net income, and increase 43% in societory, but
looking at regulatory assets and liabilities, minus 6.8%.

The next slide the evolution of debt indebtedness. So, we had announcements this year. In the
end we had some help with funds. We have a good cash situation and Company's cash
situation, closed the semester with R$1.5 billion. So, we had insurance due to these
uncertainties. The cost of debt went up due to interest rates, 10.5% and in real terms 3.87%.

Indexation of the debt, here you can see net debt, here we have a part in TJLP. Our debt in
terms of net debt over EBITDA went up 2.99%. We explained that those R$250 million that
came from tariffs are not included. So, if we have not had this expense we would have 2.84%
here in terms of net debt. So, most of this increase from 2.90% to 2.99% has to do with the
difference between tariffs and the cost of energy, the higher cost of energy.

Here the evolution of the investments during the 1H, R$358 million in investments, 9.5% more
investments than the same period in 2013. We are expanding that network, improving the
quality and also market growth that has been strong. And also we have been fighting losses,
which has taken many of our investments and we have therefore these investments. So, our
investments continue very strong.

So now, we are open to questions and answers after these explanations. Thank you.

Caio de Vasconcelos, Citigroup:

Good afternoon. Thank you for the presentation. A quick question. We see the captive market
growing well on this semester even with the average temperature we have had. What can we
expect for the rest of the year? Why did we have this strong growth in the 2Q? And what are
you expecting in the rest of the year? Thank you.

Paulo Roberto Ribeiro Pinto:

OK. Thank you for the question. We know this, we have seen this in the last three, four years,
in the markets in Rio de Janeiro. So, we begin to notice that this has to do with temperatures
and we have more growth in consumption, especially in the residential sector. This also has to
do with the higher buying power of the population. So, we see growth, a sustainable growth,
and this has to do with temperature. We are expecting warmer months and this can have an
impact at the end of the year.

Now GSF, our projections, the expectation is that it can drop in the 2H. We are expecting a
drop, to 34.5%. Thus, we would have the situation in comparison with the 1Q. The Brazilian
market has experienced this growth.

Caio de Vasconcelos:

Perfect. Thank you.

Carolina Carneiro, Santander:

We see in this quarter higher consumption and reduction and the losses was significant. But
comparing with the goal that you have defined by the regulating agency, 40.4% terms of
losses, it seems that you will need an additional effort to have a further drop in losses to reach
the goal until July 2015. What do you believe is the trend?

Do you believe that it is possible to reach the goal in terms of reducing the losses and do you
have to accelerate your efforts? Maybe you could improve this in the 2H to reach the
numbers. So I would like to know from you how do you see this in terms of reaching the goal
that the regulating agency gave you from this quarter until the half of next year, 2015? Do you
believe you can reach it?

Paulo Roberto Ribeiro Pinto:

Well, you can see that we had in the 1Q some difficulties to reach the goal. In Rio de Janeiro
we had some problems in this area, an enormous difficulty in some areas. And this occurred,
we doubled the number of teams we have in this area, also investments working on the
network.

And then, we have done a constant follow-up together with the investments. As I said, we
increased the efforts in the 2H. Let us hope we will be able to not only to recover this small
deviation from our goal in July, and thus we are very optimistic for the results in August next
year. Now, by December we should see this improvement.

I would like to say that there have been these factors that I mentioned. So we should get to
42% by December of this year, and we hope to reach in August the goals set by Aneel. We just
closed, we just signed a contract for equipment, intelligent meters and also the
communication network. So, by the middle of next year, we should have part of these
installed, facilitating the work. This year, we have 150,000 meters installed. We have an annual
goal of 200,000 meters to be installed, and this in the next five years.

So, in general terms, this is the initial phase. We had some problems, yes, but we are
mobilizing new teams, but we are definitely working on this. And I believe that we will be able
to recover and have better results. So, we want to do this and marketing. We also have other
areas, for example, emergency, and concerning this, the other parts we're doing well, and we
will definitely work to recover in this area as of July.

And as you know, this is one of our priorities, working on loss prevention. We have given the
support to the area working on this. We are audited by the regulating agency. I believe, as I
said, in a recovery. We have these goals in distribution too. So, we also depend on other
external factors that are non-manageable, but we trust that we will recover this for our
shareholders. So, I hope I answered your question.

Carolina Carneiro:

Thank you.

Pedro Manfredini:

Good afternoon. I have two questions. You remember that in November you had a goal of
40.41. So, your goal for 2015, 39 as you mentioned, do you expect to get to November with
40.41 in loss prevention? Before you answer, we noticed here an increase in total losses which
makes us believe that there is volatility here and problems in the technical losses. Why do you
have this type of volatility in the quarter? I thought this would be more constant.

And the third question, you have most of the energy parts for Light comes from Itaipu
generation plant. And then the costs have to be then passed on to consumers in December. I
do not know the right date. When the tariffs, the price from Itaipu generation plant come, do
you believe you will include this price increase from Itaipu in the next tariff? This is important.

Paulo Roberto Ribeiro Pinto:

Well, one at a time. In terms of losses, the 40.41 was a line, we had a number that we have to
negotiate with the regulating agency. And we said: let us work with 40.41 in relation to our
actual numbers, and let us see how much money we need for the investments program.

So, R$750 million we have obligations with R$1.250 billion of capital from shareholders, this
gave us R$2 billion. So, 40.41 in resources represents, in five years, R$750 million. In parallel,
we defined the goal with Aneel which goes from 40.41, and during the audit it was determined
that it would go from 40.41 to 39.32 in August.

So, the goal of the regulating agency is 39.32. Internally we have our goal which is Light's goal,
an annual goal for December, we should get to 40.38 in December 2014. That is our internal
goal. So we are working to reach the regulatory goal. And it is important that we get to ours in
December 30
th
, 2014, 40.38 and then we will go in the direction of 39.92. Then there is more.
Then there is 2016, 38; 2017, 34.49. So, this is our path. So 40.41 is a reference to define the
amount of money that we will receive for investments.

Pedro Manfredini:

And in terms of technical losses, it is a reduction of total losses, you had an increase here in
the losses. I would like to understand why. I know it is not that relevant, but since you had a
drop in low tension. Why do you have this increase? Just to understand the reason.

Paulo Roberto Ribeiro Pinto:

I will ask Angela to clarify this point.

Pedro Manfredini:

The total loss as you can see on page eight, June last year 23.4% to 23.3% this year. So, it
remained constant. There was a reduction here. So, your question is: how can the total loss
remain constant and the non-technical loss has dropped? This has to do with the low, the
denominator difference from the other indexes. Here, it is the total, here we have the total
light including high tension, which is the market that suffered a drop. So, here in high tension,
we have very little technical losses. Technical losses in low tension is 8%, in high tension, it is
1%. If in turn you reduce the losses in high tension in relation to the total loss, the effect is very
small.

So, the numerator changes very little, the nominator drops a lot, because you have a reduction
here. So, that is the reason. So, the mechanical effect would be to have an increase here
without any effect on billing. It is the reduction in the high tension markets and also due to the
drop in the industrial sector.

Pedro Manfredini:

OK. Thank you. The next question, Itaipu, at the end of the year, you will have a price increase
and since Itaipu represents a large part of your expenses, do you believe that the new
accounts will include what is paid to Itaipu?

Paulo Roberto Ribeiro Pinto:

In fact, Itaipu has this importance, we have hydrological risk, as you said, at the end of this
year. We will make new calculations and we will have a new tariff that will be certified.
Normally Itaipu's price changes in July every year. So, it will take some time until this effect is
felt in our tariffs. For example, right after Itaipu readjust its prices, we will also do the same.

Pedro Manfredini:

OK. Thank you.

Marcello Britto, Citi:

Good afternoon. I have a regulatory question for Angela. Angela, this increase in cost and the
price of energy affect the Company's performance, especially for the losses that do not have
coverage and we see that the situation was aggravated due to the price you pay for the
energy. This part, which has to do with the losses is also included in the CDE. Does the
Company have the right to recover this? In case it does not have the right, do you have
accruals for this as a liability to be returned to the tariff as of the next price increase?

Angela Pierucci:

I would separate this question into two. One is non-voluntary exposure. So I have non-
voluntary exposure. So, this exposure, if you go to the public hearing that is the proposal, spot
purchases are considered as non-manageable purchases in the spot market. Two, this is not
considered. The other issue is the availability that we have in the plants, generation plants, but
there is an understanding of decree 563 does not allow the shareholder to do the following, to
charge this extra amount.

So, they call this hydrological risk, and in the decree, it says that this difference will be passed
on to consumers. This is being discussed in the regulating agency, we in a conservative way.
We are not considering this. So at the end, it is being discussed, yes, and it is not part of our
assets.

Marcello Brito:

Thank you.

Operator:

Thank you. Since we have no more questions, I would like to pass the floor to Mr. Paulo Pinto
for his final words. You may have the floor, sir.

Paulo Roberto Ribeiro Pinto:

I believe we would like to say that we spent an hour with the presentation, the Q&A session.
The distribution companies are willing to follow with their negotiations, also looking at the
market with its characteristics it is important as I said in my initial words, a part that is
manageable, it is doing very well. We insist saying this we are maintaining our performance in
this area. We have the losses.

We are very concerned with the goals that must be reached. We continue with our efforts in
this area, we are very optimistic in relation to this. Although in the 1H we had some problems
due to restructuring of the teams of the field, of course, we believe the recovery, safety policy
continues to be important for our company to continue being a success, fighting losses in the
risky areas where we have access, not only to make investments, but also to do maintenance
in the network.

We are reinforcing our safety policy, also we have participation of the communities and we
want to continue with these efforts in order to work and reach these aggressive goals we have.
Concerning the deficits in the tariffs, the federal government has shown that they are
concerned with the impact on distribution companies. Distribution companies are important.

Today, 40%, 43% of the tariff is for generation. So, it is very relevant, the cash flow of the
distribution companies to preserve other segments like generation and also the efforts have
been seen evidently. There, distribution companies, there is little they can do. They depend on
the tariffs and measures to solve this problem. Our expectation is that by the end of the year
these negative impacts on distribution companies will be solved.

Once again, thank you very much and we hope to be with you in the next semester. Thank you.

Operator:

Thank you. The teleconference is now concluded.