CTEEP Companhia de Transmissão de Energia Eletrica Paulista S A : ESG Report

In 2021, once again, ISA CTEEP proved its ability to create sustainable value for its stakeholders. Guided by the purpose of creating Connections that inspire, we overcame challenges, made important deliveries and reinforced our values and commitments, with the support of our more than 1,300 employees, essential for us to achieve our goals.

Due to the COVID-19 pandemic, which has not ceased yet, we prioritized the health and safety of our employees and third parties. We followed the protocols to mitigate the spread of the virus, encouraged vaccination and held sessions with doctors and epidemiologists to clarify doubts regarding immunization. At the end of the year, we celebrated that 98% of our staff was immunized.

Generating sustainable value also involves ensuring the delivery of reliable electricity to the population through operational excellence. For this purpose, we continue to expand

investments in the modernization of the network and expansion of the national transmission system, with a rigorous allocation of capital and focus on efficiency in operations with high rates of availability and quality of service.

In 2021, we energized two projects auctioned in the transmission auctions carried out by Aneel (National Electric Energy Agency) - the Aguapeí Electric Interconnection and Lorena Substation, the result of our planning and management capacity. In all, we have nine projects under construction, which will add 1,700 kilometers of extension in our transmission lines and 10,000 MVA of power to our portfolio.

As for Lorena Substation, it is worth emphasizing the advance this asset represents for ISA CTEEP and for the digitization of the Brazilian electricity sector. It is the first digital substation of the National Interconnected System that, in addition to providing greater availability and efficiency in the provision of services, contributes to

improving the reliability and collection of information to support decision-making.

Another historical milestone of innovation for the company and for the sector was the achievement of Aneel's approval of the first large-scale battery energy storage project in the Brazilian transmission system, which will be installed at Registro Substation (SP), responsible for supplying the population of the South Coast of São Paulo. In addition to facilitating the insertion of energy from renewable sources, the technology contributes to the reduction of operating costs and the need to expand the system.

Also in 2021, we completed the acquisition of Piratininga - Bandeirantes Transmissora de Energia (PBTE), which operates a 30-km underground transmission line in the city of São Paulo. For the coming years, we remain aware of the opportunities with our growth plan based on three routes - reinforcements

"We continue to expand investments in the modernization of the network and in the expansion of the national transmission system"

and improvements, participation in auctions (greenfield) and mergers and acquisitions (brownfield) - which should contribute to greater network robustness.

There was also an important advance with the approval by Aneel of the reprofiling of the Base Network of the Existing System (RBSE). The measure ends the regulatory discussion of almost a decade on the remuneration of the

RUI CHAMMAS

CEO

financial component of RBSE and preserves the economic value for the company by ensuring the payment of the financial component until 2028, in addition to maintaining the remuneration for the cost of regulatory capital defined in the 2018 Periodic Tariff Review.

Throughout the year, despite uncertainty scenarios, we honored our commitments to our shareholders. In the financial scope, our gross operating revenue (IFRS) totaled R$ 6,336 million, an increase of 49% compared to the R$ 4,241 million recorded in 2020, reflecting the financial component of RBSE and updating the values by IPCA, as well as recognition of the complementary right Ke according to ANEEL Approval Resolution No. 2,851/21. We have also achieved the highest payout of earnings in our history.

Our responsibility goes beyond the boundaries of the company and extends throughout society. Thus, we are guided by the generation of positive social and environmental impacts and we proactively contribute to actions to combat climate change and the conservation of ecosystems. We continue with the commitment to maintain our carbon neutrality through

the total compensation of Greenhouse Gas emissions (scopes 1 and 2, except transmission losses) and, at the end of the year, we expanded

the range of our Conexion Jaguar Program for protection of 141,000 hectares in Serra do Amolar, in the Pantanal.

In addition, we have pursued eco-efficiency goals in our operations that aim to reduce the consumption of water, energy and SF₆ gas, which for the first time started to compose the variable remuneration of executives. Another important achievement was raising funds

by issuing green bonds in the amount of R$

672.5 million in 2021 for the development of environmentally sustainable projects.

In this journey of evolution, safety is a non- negotiable value for us and, in order to reinforce our practices, we launched the Connected with Life program, which, in addition to actions to promote safety, it incorporates a perception

of global life care for our employees and third parties. Despite all these achievements and advances, I regret the three unacceptable fatalities that we registered with third parties in the period and that have caused a deep transformation in the company.

Still with regard to the management of our human capital, we continue to focus on actions aligned with our Leadership Brand that reinforce the skills necessary to comply with our 2030 Strategy. In this context, initiatives to ensure the sustainability

of our talents, which include training and the promotion of a diverse and inclusive environment, reinforced by our Other Looks program, acting on the pillars of gender equity, race, LGBTI+ and people with disabilities. This year, for the first time, we launched an intern recruitment program with an affirmative diversity approach.

In view of all these events and the others presented throughout this report,­I would especially like to thank our more than 1,300 employees for their dedication in 2021. I also thank for the Connections that Inspire with ISA, the Company's parent company and Ecopetrol Group company, as well as our­shareholders, partners, the regulator and society.

For the future, we remain committed to the health and safety of our employees and third parties, with operational excellence, with innovations to contribute to the transformations of the sector and with actions to ensure

the robustness of the national transmission system, always guided by the maximization of sustainable value generation for our audiences.

Rui Chammas

CEO ISA CTEEP

35.7

average hours of

training per employee

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