Luiza Candiota: I missed part of the Q&A session, and I don’t know if you have already talked about the next capacity auction, but I would like to have an update on the process to know if you believe that it’s possible to have this auction in the third quarter at the end of August as forecasted, and which are the main topics still to be developed? And for [indiscernible], which would be the additional estimated CapEx to expand the capacity? And my second question about energy trading, we see that you sold an amount — a significant amount for ’24 and ’25 seizing this window of opportunity in the first quarter. And I don’t know if you already mentioned, but I would like to have more color on the average price of the contracts, if that was in line with the [indiscernible] that we have seen in this period.
Unidentified Company Representative: I think we have already talked about the trading. So the highlights of these opportunities are within our strategy. This was a strategy that took advantage of this volatility and price increase, but also aiming at risk mitigation and portfolio. So we still have some vision for ’26 on, and we have a moderately optimistic view here. And we had annual sales and also strategies in the beginning of the year and the end of the year. And we can conclude that this was in line with the DIS. And maybe in the afternoon or tomorrow, we can talk to you so that we do not need to go over the strategy all over again. Now about the capacity, we believe that the capacity auction, it should happen in the second half of the year.
There is a good chance that it could be postponed in 30 to 60 days, but we do understand that it should happen over the second half of the year, we have a positioned — the CapEx, we do not have any civil construction works and environmental area is ready, is prepared. We just need minor adjustments. So the CapEx perspective, we are not disclosing that for strategic reasons and it has to do with our competitiveness and our strategy. Number two, about preparations and you can go — can you go into the details to Luiza and everyone. Well, on April 26, we had the conclusion of the documentation for the public hearing. And so the auction should happen in the second half of the year, maybe September, but it’s going to be the second half of 2024.
For — the conditions for Copel to participate in this auction are very good. We already have the environmental license, so that we can move forward with the construction works. So we have the basic project, the ordinance has been already published. So we have everything ready, all the technical and legal conditions to be part of the auction. The commercial deals are being done with the suppliers of turbines for that type of power of 400 megawatts. So we are in very favorable conditions waiting for the auction to be set. And as far as we know, we only have 2 products, wind and thermal — I’m sorry, also hydro and thermal 2 products. So and — a good perspective here, and we also have valuations for future capacity auctions and also expansion for capacity and power.
Operator: Our next question is from Mr. Gustavo Marcus, investor.
Unidentified Analyst: Will Copel increase the generation portfolio for solar and wind energy, reducing the hydro generation.
Unidentified Company Representative: Gustavo, in the short term, not this year and neither the next one, we do not plan to invest in the expansion in these sources because of energy prices. We are analyzing it but we have no projects, not in the greenfield neither in the ones that we have in the market, none of them meet the returns expected by the company at least in the short and medium term. And medium term, I’m saying here, it’s 24 months. On the other hand, we see more and more that the water source is needed as strategic and important for the industry. So we have an agenda for the mid and long-term so that the water source attributes and this capacity auction is a first and initial movement here, but — and they are crucial to the energy security of the country, both hydro and thermal for our — and also energy, sustainability and security.So the company is always paying attention to that.
Our business is always analyzing it following up the market’s movements, checking new opportunities. But I would say that these sources and despite of being important it is strategic or not in our priority. First, we have the capacity auction. Also in the second half of the year, we have — we will have a transmission auction that might make sense to Copel’s strategy considering it will be closed to Parana and south region, but these are opportunities that are still being analyzed here in our internal flow. So our priority now is the execution of value generation strategy to conclude the renewal to deliver the efficiency milestones to work on the divestments, to conclude Compagas, and now these small generation assets. This is our strategic vision.
And then with the company then 100% in line in this first stage, will — it will be able to analyze the allocation. Any company that generates value in a perennial fashion also has to have a very well-balanced and safe strategy, and it has to be very much discipline in its capital allocation.
Operator: Our next question is from Mr. Leonardo Gonzaga from BNDES.
Leonardo Gonzaga: I would like to know if you already have a forecast for concession payments. There are discussions about the possibility of tax paying on possible capital gains regarding the renewal of those or this is a topic that is no longer being discussed?
Unidentified Company Representative: Let’s divide here the answer for this question, okay? We’ll talk about taxes as well. Well, with the auction capacity that should happen in the beginning of the second half of the year, it’s very clear that we will have the renewal contracts signed, so — around the same date. We are discussing that in the beginning of the second half of the year, we might have the signing of the contract and then the payment. And then, Moura, if you can go into the details on the accounting of that.
Adriano Rudek de Moura: Well, we are moving forward on the study of the tax impacts in this concession. We should conclude this work in the next quarter. We are working on a number of possibilities. We have a strong opinion on what would be the best option. We will be checking this in order to conclude the process and present the results to the market in the next quarter.
Operator: The Q&A session has ended. Now we would like to turn the floor to Mr. Daniel Slaviero for his final remarks.
Daniel Slaviero: I think we tackled all relevant topics in the company, a quarter that is in line with market’s expectations. Once again, bringing sound results for Copel Distribution and on the other hand, it’s within our perspectives. Now to conclude, I would like to say that we are dedicated to our execution capacity, and we are very much focused in the value leverages, all our internal stakeholders and external stakeholders as well. We are very much excited about this process and the change that the company is going through. The internal opportunities are also great for employees that remain with us. We are having growth and recycling in the company. So I thank you all very much, and we will be moving forward with this perfect execution and our commitment in delivering results and improving Copel’s governance. Thank you all very much.
Operator: Copel video conference has ended. Thank you all very much for your participation, and have a nice day.
