Who Owns Neoenergia?

Neoenergia operates under Iberdrola's corporate sustainability framework. The company publishes an annual Sustainability Report (Relatorio de Sustentabilidade) as part of its former obligations as a B3 Novo Mercado listed company. Even after delisting, Neoenergia continues to report on sustainability as part of Iberdrola's global ESG framework.

Energy Efficiency Programs: Neoenergia invested approximately R$152 million in energy efficiency programs in 2024. The company replaced over 630,000 light bulbs with LEDs in low-income communities and installed more than 140,000 LED bulbs in over 2,300 institutions. The Vale Luz project saved customers more than R$1.4 million while recycling over 2,500 tons of solid waste.

Renewable Energy: Neoenergia is expanding its renewable energy portfolio. In 2024, the company installed 64 solar photovoltaic systems totaling 6.5 MWp across 1,720 public and welfare buildings, including schools, hospitals, and health units. Projects include solar installations on the Federal Supreme Court building in Brasilia and a planned floating solar photovoltaic plant for Fernando de Noronha.

Green Financing: Neoenergia secured a EUR 300 million green loan from the European Investment Bank to modernize the electricity grid in Bahia. The company also obtained the first JICA (Japan International Cooperation Agency) financing linked to ESG goals in the world, demonstrating international recognition of its sustainability commitments.

Grid Modernization Investment: Neoenergia has committed R$24 billion between 2024 and 2027 for network expansion, modernization, and infrastructure improvements. The company led Brazilian companies in basic infrastructure investment in 2024 with R$9.8 billion, according to ABDIB.

Educational Programs: Neoenergia trained more than 11,000 teachers and reached 240,000 students in nearly 2,000 schools through electricity efficiency programs. The company's Energy Museum in Salvador and mobile educational units have educated over 60,000 people about conscious energy consumption.

Social Responsibility: Neoenergia's energy efficiency programs specifically target low-income communities. The company replaced old refrigerators for consumers in areas affected by natural disasters in Bahia and implemented projects that benefit underserved populations.

No Brand-Specific Certifications: Neoenergia does not hold B Corp certification or similar independent sustainability certifications. However, as part of Iberdrola, the company participates in the parent company's sustainability reporting framework, which is aligned with GRI standards and the UN Sustainable Development Goals.

Neoenergia won a record eight trophies at the 2025 Abradee Awards (Premio Abradee), the most prestigious awards in Brazil's electricity distribution sector:

• Neoenergia Cosern: Best distributor in Brazil (second time) and best in the Northeast (seventh time)
• Neoenergia Elektro: Best utility in the Southeast region; first place in Management Quality, Innovation Management, and Operational Management among companies with more than 500,000 consumers
• Neoenergia Brasilia: First place in the Performance Evolution category (first time a Federal District distributor has won this category)
• Neoenergia Cosern: Honorable mention in Health and Safety among companies with more than 500,000 consumers

The Abradee Awards evaluate companies on management quality, innovation, sustainability, customer evaluation, and operational performance. Neoenergia's record performance in 2025 demonstrates its position as an industry leader in Brazil's electricity distribution sector.

Eletropaulo Metropolitana Arbitration (2025): Neoenergia requested arbitration over issues related to an investment agreement with Eletropaulo Metropolitana SA, a power distribution company serving the Sao Paulo metropolitan area. The dispute concerns investment terms and operational agreements, highlighting the complex legal landscape of Brazil's electricity sector.

ANEEL Regulatory Compliance: As a major electricity distributor, Neoenergia operates under strict regulatory oversight from ANEEL. The company must comply with evolving regulatory requirements, tariff structures, and quality standards. Non-compliance can result in regulatory penalties. ANEEL publishes performance metrics for all distribution companies, creating public accountability for service quality.

Grid Reliability Challenges: Neoenergia faces challenges related to grid reliability, particularly during extreme weather events in Northeast Brazil. Power outages can lead to customer dissatisfaction, regulatory penalties, and reputational damage. The company's R$24 billion investment plan for 2024-2027 is partly aimed at improving grid resilience.

Delisting and Reduced Transparency (2026): Neoenergia's delisting from B3 in May 2026 reduced public transparency. As a publicly traded company on the Novo Mercado segment, Neoenergia was subject to the highest corporate governance standards in Brazil, including mandatory minimum free float and enhanced disclosure requirements. As a private subsidiary of Iberdrola, Neoenergia's financial results are reported only as part of Iberdrola's consolidated financial statements, reducing granularity for Brazilian stakeholders.

Environmental Licensing: Neoenergia's infrastructure projects require environmental licenses from Brazilian authorities. The company must navigate complex environmental regulations, particularly for transmission lines and generation projects that cross sensitive ecological areas or indigenous territories.

Labor Relations: As a major employer in the Brazilian electricity sector, Neoenergia must manage relationships with multiple employee unions. Labor disputes and salary negotiations can impact operations.