16.

INVESTMENTS

This table provides a summary of the financial information of affiliated companies and jointly-controlled entities. The information below reflects the percentage of the Company’s equity interest in each company.


	Control		2017		2016
Hidrelétrica Cachoeirão		Jointly-controlled		58		50
Guanhães Energia		Jointly-controlled		25		—
Hidrelétrica Pipoca		Jointly-controlled		26		32
Retiro Baixo		Jointly-controlled		158		162
Aliança Norte (Belo Monte plant)		Jointly-controlled		577		527
Madeira Energia (Santo Antônio plant) (2)		Affiliated		535		644
FIP Melbourne (Santo Antônio plant) (2)		Affiliated		582		677
Lightger		Jointly-controlled		41		42
Baguari Energia		Jointly-controlled		148		162
Renova		Jointly-controlled		282		689
Aliança Geração		Jointly-controlled		1,242		1,319
Central Eólica Praias de Parajuru		Jointly-controlled		60		63
Central Eólica Volta do Rio		Jointly-controlled		68		81
Central Eólica Praias de Morgado		Jointly-controlled		51		60
Amazônia Energia (Belo Monte Plant)		Jointly-controlled		867		781
Usina Hidrelétrica Itaocara S.A.		Jointly-controlled		4		3
Light		Jointly-controlled		1,534		1,070
Taesa		Jointly-controlled		1,101		1,583
Ativas Data Center (2)		Affiliated		17		18
LEPSA (1)		Subsidiary		—		344
RME		Jointly-controlled		383		339
Companhia Transleste de Transmissão		Jointly-controlled		—		22
Companhia Transudeste de Transmissão		Jointly-controlled		—		21
Companhia Transirapé de Transmissão		Jointly-controlled		—		24
Companhia de Transmissão Centroeste de Minas		Jointly-controlled		21		21
Axxiom Soluções Tecnológicas		Jointly-controlled		12		19

Total of investments				7,792		8,753
Guanhães – Uncovered liabilities of jointly-controlled entity		Jointly-controlled		—		(59	)

Total				7,792		8,694

(1)

On November 2017, the Company acquired all the shares of Lepsa, and therefore as from that date now consolidates that company in its financial statements. Lepsa’s sole asset is comprised of an investment in common and preferred shares in Light. Hence the Company no longer presents the investment that it previously held in Lepsa in its consolidated financial statements, presenting only the interest in Light.

(2)

The Company’s investees that are not consolidated are jointly-controlled entities, with the exception of the interest in the Santo Antônio power plant, and Ativas Data Center, which are affiliated companies in which the interests held (by Cemig GT and Cemig Telecom, respectively) exercise significant influence. It was as from the fourth quarter of 2016 that Ativas Data Center became an investee in which Cemig has significant influence.

a)	Right to exploitation of the regulated activity

In the process of allocation of the acquisition price of the jointly-controlled subsidiaries, a valuation was made of the intangible assets relating to the right to operate the regulated activity. This asset is presented together with the acquisition cost of the investments in the previous table. These assets will be amortized over the remaining period of the concessions on the straight-line basis.


	2014		Amortization			2015		Addition		Amortization			Written off			2016		Amortization			Written off			2017
Taesa		433		(18	)		415		—		(18	)		(109	)		288		(13	)		(86	)		189
Light		253		(22	)		231		—		(22	)		—			209		(23	)		—			186
Gasmig		220		(5	)		215		—		(8	)		—			207		(7	)		—			200
Lepsa		—		—			—		50		(1	)		—			49		(6	)		(43	)		—
RME		—		—			—		49		(1	)		—			48		(5	)		—			43

Total		906		(45	)		861		99		(50	)		(109	)		801		(54	)		(129	)		618

b)	The movement of Investments in the jointly-controlled entities in 2017, 2016 and 2015, is as follows:


	2016			Gain (loss) by equity method (Income statement)			Gain (loss) by equity method (Other comprehensive income)			Dividends			Injections / acquisitions		Sales			Others			2017
Companhia Transleste de Transmissão		22			5			—			(7	)		—		(20	)		—			—
Companhia Transudeste de Transmissão		21			3			—			(12	)		—		(12	)		—			—
Companhia Transirapé de Transmissão		24			4			—			(6	)		—		(22	)		—			—
Companhia de Transmissão Centroeste de Minas		21			5			—			(5	)		—		—			—			21
Light		1,070			35			(3	)		—			—		—			432			1,534
Axxiom Soluções Tecnológicas		19			(7	)		—			—			—		—			—			12
Lepsa		344			—			(2	)		—			—		—			(342	)		—
RME		339			7			(2	)		—			38		—			1			383
Hidrelétrica Cachoeirão		50			10			—			(3	)		—		—			1			58
Guanhães Energia (1)		—			(13	)		—			—			97		—			(59	)		25
Hidrelétrica Pipoca		32			2			—			(8	)		—		—			—			26
Madeira Energia (Santo Antônio plant)		644			(109	)		—			—			—		—			—			535
FIP Melbourne (Santo Antônio plant)		677			(95	)		—			—			—		—			—			582
Lightger		42			2			—			(3	)		—		—			—			41
Baguari Energia		162			17			—			(30	)		—		—			(1	)		148
Central Eólica Praias de Parajuru		63			(1	)		—			—			—		—			(2	)		60
Central Eólica Volta do Rio		81			(12	)		—			—			—		—			(1	)		68
Central Eólica Praias de Morgado		60			(8	)		—			—			—		—			(1	)		51
Amazônia Energia (Belo Monte Plant)		781			1			—			—			85		—			—			867
Ativas Data Center		18			(2	)		—			—			—		—			1			17
Taesa		1,583			216			—			(183	)		—		(515	)		—			1,101
Renova		689			(390	)		(34	)		—			18		—			(1	)		282
Usina Hidrelétrica Itaocara S.A.		3			(2	)		—			—			3		—			—			4
Aliança Geração		1,319			72			—			(149	)		—		—			—			1,242
Aliança Norte (Belo Monte plant)		527			(2	)		—			—			51		—			1			577
Retiro Baixo		162			10			—			(14	)		—		—			—			158

Total of investments		8,753			(252	)		(41	)		(420	)		292		(569	)		29			7,792

Guanhães Energia – Uncovered liabilities of jointly-controlled entity (1)		(59	)		—			—			—			—		—			59			—

		8,694			(252	)		(41	)		(420	)		292		(569	)		88			7,792

1)	Uncovered liability reversed through injection of capital.


	2015			Equity method gain (Statement of income)			Gain (loss) by equity method (Other comprehensive income)			Dividends			Injections / acquisitions		Sales			Merger			Other			2016
Companhia Transleste de Transmissão		18			6			—			(2	)		—		—			—			—			22
Companhia Transudeste de Transmissão		18			4			—			(1	)		—		—			—			—			21
Companhia Transirapé de Transmissão		19			5			—			—			—		—			—			—			24
Transchile		108			2			(23	)		—			—		(87	)		—			—			—
Companhia de Transmissão Centroeste de Minas		18			5			—			(2	)		—		—			—			—			21
Light		1,188			(121	)		3			—			—		—			—			—			1,070
Axxiom Soluções Tecnológicas		24			(5	)		—			—			—		—			—			—			19
Lepsa		—			(18	)		1			(57	)		252		—			166			—			344
RME		—			(20	)		—			(58	)		247		—			169			1			339
Hidrelétrica Cachoeirão		42			10			—			(2	)		—		—			—			—			50
Guanhães Energia (1)		19			(103	)		—			—			25		—			—			59			—
Hidrelétrica Pipoca		27			5			—			—			—		—			—			—			32
Madeira Energia (Santo Antônio Plant through Madeira Energia)		676			(71	)		—			—			39		—			—			—			644
FIP Melbourne (Santo Antônio Plant through Madeira Energia)		703			(63	)		—			—			40		—			—			(3	)		677
LightGer		37			5			—			—			—		—			—			—			42
Baguari Energia		187			41			—			(14	)		—		—			—			(52	)		162
Central Eólica Praias de Parajuru		63			—			—			—			—		—			—			—			63
Central Eólica Volta do Rio		85			(4	)		—			—			—		—			—			—			81
Central Eólica Praias de Morgado		62			(2	)		—			—			—		—			—			—			60
Amazônia Energia (Belo Monte Plant through Norte Energia)		495			(6	)		—			—			292		—			—			—			781
Ativas Data Center (2)		—			(31	)		—			—			99		—			—			(50	)		18
Parati		358			(24	)		1			—			—		—			(335	)		—
Taesa		2,242			342			—			(382	)		—		(619	)		—			—			1,583
Renova (3)		1,527			(372	)		19			—			278		—			—			(763	)		689
Usina Hidrelétrica Itaocara S.A.		—			—			—			—			3		—			—			—			3
Aliança Geração		1,327			104			—			(112	)		—		—			—			—			1,319
Aliança Norte (Belo Monte Plant through Norte Energia)		354			(7	)		—			—			180		—			—			—			527
Retiro Baixo		148			16			—			(2	)		—		—			—			—			162

Total of investments		9,745			(302	)		1			(632	)		1,455		(706	)		—			(808	)		8,753

Ativas Data Center – Uncovered liabilities of jointly-controlled entity		(28	)		—			—			—			—		—			—			28			—
Guanhães Energia – Uncovered liabilities of jointly-controlled entity		—			—			—			—			—		—			—			(59	)		(59	)

Total		9,717			(302	)		1			(632	)		1,455		(706	)		—			(839	)		8,694

(1)	Transfer to uncovered liabilities.

(2)	The amount of R$ 50 refers to the dilution of shareholding interest arising from subscription of share capital by a new shareholder.

(3)	The amount of R$ 763 refers to the impairment of intangible concession assets resulting from the financial difficulties of Renova.


	2014		Equity method gain (Statement of income)			Equity method gain (Other comprehensive income)		Dividends			Injections / acquisitions		Other			2015
Companhia Transleste de Transmissão		14		8			—		(4	)		—		—			18
Companhia Transudeste de Transmissão		13		5			—		—			—		—			18
Companhia Transirapé de Transmissão		13		6			—		—			—		—			19
Transchile		67		5			36		—			—		—			108
Companhia de Transmissão Centroeste de Minas		22		2			—		(6	)		—		—			18
Light		1,198		(11	)		2		(1	)		—		—			1,188
Axxiom Soluções Tecnológicas		23		1			—		—			—		—			24
Hidrelétrica Cachoeirão		34		8			—		—			—		—			42
Guanhães Energia		69		(49	)		—		(1	)		—		—			19
Hidrelétrica Pipoca		28		2			—		(3	)		—		—			27
Madeira Energia (Santo Antônio plant through Madeira Energia)		674		2			—		—			—		—			676
FIP Melbourne (Santo Antônio plant through Madeira Energia)		708		(5	)		—		—			—		—			703
Lightger		38		(1	)		—		—			—		—			37
Baguari Energia		193		12			—		(18	)		—		—			187
Central Eólica Praias de Parajuru		62		2			—		(1	)		—		—			63
Central Eólica Volta do Rio		84		2			—		(1	)		—		—			85
Central Eólica Praias de Morgado		62		—			—		—			—		—			62
Amazônia Energia (Belo Monte Plant through Norte Energia)		395		(19	)		—		(1	)		120		—			495
Ativas Data Center		—		(28	)		—		—			—		28			—
Epícares Empreendimentos (1)		92		1			—		1			—		(94	)		—
Parati		372		3			—		(17	)		—		—			358
Taesa		2,188		383			—		(329	)		—		—			2,242
Renova		1,538		(25	)		15		(1	)		—		—			1,527
Aliança Geração		3		107			—		(93	)		581		729			1,327
Aliança Norte (Belo Monte Plant through Norte Energia)		—		(13	)		—		—			367		—			354
Retiro Baixo		150		(5	)		—		—			3		—			148

Total of investments		8,040		393			53		(475	)		1,071		663			9,745

Ativas Data Center – Uncovered liabilities of jointly-controlled entity		—		—			—		—			—		(28	)		(28	)

Total		8,040		393			53		(475	)		1,071		635			9,717

(1)	The amount of R$ 94 refers to the assets subscribed to constitute Aliança Geração;

c)	Information from the subsidiaries and jointly-controlled entities:


Company	Number of shares		2017						2016						2015
Company	Number of shares		Cemig interest %		Share capital		Equity		Cemig interest %		Share capital		Equity		Cemig interest %		Share capital		Equity
Cemig Geração e Transmissão		2,896,785,358		100.00		1,838		4,794		100.00		1,838		4,583		100.00		1,838		4,684
Hidrelétrica Cachoeirão		35,000,000		49.00		35		118		49.00		35		103		49.00		35		83
Guanhães Energia		330,536,000		49.00		331		51		49.00		186		—		49.00		138		38
Hidrelétrica Pipoca		41,360,000		49.00		41		53		49.00		41		65		49.00		41		54
Retiro Baixo		222,850,000		49.90		223		258		49.90		223		264		49.90		223		296
Aliança Norte (Belo Monte Plant)		3,622,440,125		49.00		1,119		1,066		49.00		1,014		1,077		49.00		647		723
Madeira Energia (Santo Antônio Plant)		9,730,201,137		18.13		9,547		5,327		18.13		10,152		6,419		18.05		9,762		7,642
Lightger		79,078,937		49.00		79		83		49.00		79		85		49.00		79		76
Baguari Energia S.A. (1)		26,157,300,278		69.39		187		214		69.39		187		248		69.39		262		270
Renova (2)		417,197,244		36.23		2,919		780		34.15		2,856		1,956		27.37		2,526		5,581
Aliança Geração		1,291,582,500		45.00		1,291		1,858		45.00		1,291		1,973		45.00		1,291		2,949
Central Eólica Praias de Parajuru		70,560,000		49.00		71		89		49.00		71		89		49.00		71		129
Central Eólica Volta do Rio		117,230,000		49.00		117		116		49.00		117		137		49.00		117		174
Central Eólica Praias de Morgado		52,960,000		49.00		53		54		49.00		53		65		49.00		53		127
Amazônia Energia (1) (Belo Monte Plant)		1,229,600,123		74.50		1,230		1,163		74.50		1,116		1,048		74.50		723		665
Usina Hidrelétrica Itaocara S.A.		11,102,420		49.00		11		8		49.00		6		6		—		—		—
Cemig Distribuição		2,359,113,452		100.00		2,772		3,737		100.00		2,362		2,500		100.00		2,362		2,696
Light		203,934,060		26.06		2,226		3,462		26.06		2,226		3,354		26.06		2,226		4,558
CemigTelecom		448,340,822		100.00		292		247		100.00		242		192		100.00		225		169
Rosal Energia		46,944,467		100.00		47		107		100.00		47		141		100.00		47		122
Sá Carvalho		361,200,000		100.00		37		103		100.00		37		106		100.00		37		103
Gasmig		409,255,483		99.57		665		1,224		99.57		665		1,426		99.57		665		1,408
Horizontes Energia		39,257,563		100.00		39		53		100.00		39		52		100.00		64		71
Usina Térmica Ipatinga		174,281		100.00		—		5		100.00		—		4		100.00		—		4
Cemig PCH		35,952,000		100.00		36		97		100.00		36		92		100.00		36		85
Lepsa		1,379,839,905		100.00		406		456		66.62		438		443		—		—		—
RME		1,365,421,406		75.00		403		453		66.27		434		440		—		—		—
Companhia Transleste de Transmissão		49,569,000		—		50		—		25.00		50		81		25.00		50		73
UTE Barreiro				100.00		17		18		100.00		31		39		100.00		31		30
Companhia Transudeste de Transmissão		30,000,000		—		30		—		24.00		30		85		24.00		30		73
Empresa de Comercialização de Energia Elétrica		486,000		100.00		—		18		100.00		—		20		100.00		—		9
Companhia Transirapé de Transmissão		22,340,490		—		22		—		24.50		22		98		24.50		22		79
Transchile		—		—		—		—		—		—		—		49.00		237		221
Efficientia		6,051,994		100.00		6		7		100.00		6		5		100.00		6		6
Cemig Comercializadora de Energia Incentivada		1,000,000		100.00		1		2		100.00		1		2		100.00		5		6
Companhia de Transmissão Centroeste de Minas		28,000,000		51.00		28		40		51.00		28		42		51.00		28		34
Cemig Trading		1,000,000		100.00		1		29		100.00		1		29		100.00		—		30
Axxiom Soluções Tecnológicas		17,200,000		49.00		47		24		49.00		47		39		49.00		47		49
Parati		1,432,910,602		—		—		—		—		—		—		25.00		1,433		1,431
Taesa		1,033,496,721		21.68		3,042		4,347		31.54		3,042		4,308		43.36		3,042		5,171

(1)	Jointly-control under a Shareholders’ Agreement.

(2)	Due to the increase in the equity interest in Renova, there was a loss item of R$2 million reflecting the fact that Renova reported a loss for the year 2016.

On December 31, 2017, the current liabilities of some jointly-controlled entities exceeded their current assets, as follows:

Light: On December 31, 2017, Light had consolidated negative working capital of R$ 1,355 (R$ 1,259 on December 31, 2016). The management of Light has been negotiating the renewal of short-term loans and financings, and is in the process of extending its debt maturity profile in 2018 through new issues of debt instruments. Management believes that by extending its debt maturity profile the current financial situation will be reverted.

Madeira Energia (‘Mesa’): The excess of current liabilities over current assets, equal to R$ 1,474 (R$ 1,611 in 2016), arises mainly from the balances of the accounts Suppliers, Other liabilities and Loans and financings. Mesa expects to adjust the flow of its debt servicing payments with the BNDES and the onlending banks, and the release of funds from the reserve account to be allocated to these payments, which will be replaced by a bank guarantee and operational cash generation.

Renova Energia: In 2017, Renova Energia reported accumulated losses of R$ 2,195 (R$ 1,101 in 2016 and R$ 93 in 2015), and current liabilities of R$ 1,607 (R$ 3,211 in 2016) in excess of current assets. Renova Energia is required to obtain capital to comply with the construction commitments of wind and solar generating plants.

For this purpose it has taken several measures to rebalance its liquidity and cash flow structure through the sale of assets, using the funds to pay suppliers and amortize debt, as well as optimizing the portfolio, with sale of projects and/or operational assets.

The management of Renova Energia believes that with the success of these measures it will be possible to recover the economic and financial equilibrium, and liquidity.

Management has analyzed the indications of impairment referred to above and, based on available information and believes that there is no material uncertainty as to the continuation of the operations of these investees.

The balances for the affiliated companies and jointly-controlled entities, at December 31, 2017, 2016 and 2015, are as follows:


2017	Centroeste			RME			Light			Taesa			Axxiom			Aliança Norte			Itaocara			Lightger			Amazônia Energia			Aliança Geração
Assets
Current		56			2			4,250			1,970			46			1			5			51			—			622
Cash and cash equivalents		17			1			342			2			3			—			5			1			—			468
Non-current		1			451			11,181			6,608			11			1,065			11			142			1,163			2,398

Total assets		57			453			15,431			8,578			57			1,066			16			193			1,163			3,020

Liabilities
Current		4			—			5,575			736			29			—			1			31			—			448
Suppliers		—			—			2,023			48			1			—			1			20			—			44
Loans and financings – Current		3			—			1,373			—			5			—			—			—			—			84
Non-current		13			—			6,394			3,495			4			—			7			79			—			714
Equity		40			453			3,462			4,347			24			1,066			8			83			1,163			1,858

Total liabilities		57			453			15,431			8,578			57			1,066			16			193			1,163			3,020

Statement of income
Net sales revenue		15			—			11,315			1,104			43			—			—			42			—			920
Cost of sales		(4	)		—			—			(209	)		(55	)		—			(4	)		(28	)		—			(554	)
Depreciation and amortization		(1	)		—			—			(1	)		(2	)		—			—			(11	)		—			(127	)

Gross profit (loss)		11			—			11,315			895			(12	)		—			(4	)		14			—			366
General and administrative expenses		—			(1	)		(9,941	)		(124	)		(7	)		(1	)		—			(2	)		(1	)		(11	)
Finance income		2			16			136			368			1			—			—			4			2			30
Finance expenses		(2	)		—			(1,212	)		(434	)		(1	)		—			—			(9	)		—			(65	)

Operational profit (loss)		11			15			298			705			(19	)		(1	)		(4	)		7			1			320
Income and Social Contribution taxes		(1	)		—			(174	)		(58	)		6			—			—			(3	)		—			(104	)

Net income (loss) for the year		10			15			124			647			(13	)		(1	)		(4	)		4			1			216

Comprehensive income (loss) effects		—			(2	)		(15	)		—			—			—			—			—			—			—

Comprehensive income (loss) for the year		10			13			109			647			(13	)		(1	)		(4	)		4			1			216

The “Transmineiras” companies (Companhia Transleste de Transmissão S.A.; Companhia Transudeste de Transmissão S.A. and Companhia Transirapé de Transmissão S.A.) were removed from the table for 2017, due to their sale in November 2017.

LEPSA is not presented in the 2017 table due to the fact that it has been under the Company’s control since November 2017.


2017	Hidrelétrica Cachoeirão			Baguari Energia			Guanhães Energia			Madeira Energia			Hidrelétrica Pipoca			Retiro Baixo			Renova			Central Eólica de Parajuru			Central Eólica de Morgado			Central Eólica Volta do Rio
Assets
Current		51			29			11			557			15			23			32			41			11			16
Cash and cash equivalents		46			5			7			55			6			14			—			35			7			5
Non-current		87			209			42			23,594			95			366			1,679			121			136			233

Total assets		138			238			53			24,151			110			389			1,711			162			147			249

Liabilities
Current		10			18			2			2,031			18			27			395			26			90			126
Suppliers		1			10			—			203			6			3			25			1			2			1
Non-current		10			6			—			16,793			39			104			536			47			3			7
Equity		118			214			51			5,327			53			258			780			89			54			116

Total liabilities		138			238			53			24,151			110			389			1,711			162			147			249

Statement of income
Net sales revenue		39			64			—			2,971			29			67			—			21			14			22
Cost of sales		(17	)		(37	)		(1	)		(1,859	)		(18	)		(34	)		(5	)		(16	)		(17	)		(28	)
Depreciation and amortization		(4	)		(9	)		—			—			(3	)		(10	)		(5	)		(10	)		(10	)		(17	)
Gross profit (loss)		22			27			(1	)		1,112			11			33			(5	)		5			(3	)		(6	)
General and administrative expenses		—			—			—			(817	)		(1	)		—			—			(2	)		(1	)		(3	)
Provision for loss		—			—			(22	)		—			—			—			—			—			—			—
Financial income		4			6			1			115			2			3			4			3			2			3
Finance expenses		(2	)					(3	)		(1,551	)		(5	)		(11	)		(1,260	)		(6	)		(8	)		(12	)
Operational profit (loss)		24			33			(25	)		(1,141	)		7			25			(1,261	)		—			(10	)		(18	)
Income and Social Contribution taxes		(3	)		(11	)		—			49			(2	)		(3	)		121			—			(1	)		(3	)

Net income (loss) for the year		21			22			(25	)		(1,092	)		5			22			(1,140	)		—			(11	)		(21	)

Comprehensive income (loss) effects		—			—			—			—			—			—			(99	)		—			—			—

Comprehensive income (loss) for the year		21			22			(25	)		(1,092	)		5			22			(1,239	)		—			(11	)		(21	)


2016	Parati			Transleste			Transirapé			Centroeste			Transudeste			Lepsa			RME			Light			Taesa			Axxiom			Aliança Norte
Assets
Current		12			50			41			61			32			6			3			3,612			1,955			66			2
Cash and cash equivalents		8			3			2			20			4			—			—			668			102			9			2
Non-current		1,327			123			122			1			78			437			437			10,718			6,456			13			1,075

Total assets		1,339			173			163			62			110			443			440			14,330			8,411			79			1,077

		—			—			—			—			—			—			—			—			—			—			—
Liabilities		—			—			—			—			—			—			—			—			—			—			—
Current		—			28			33			5			22			—			—			4,871			1,074			32			—
Suppliers		—			—			—			—			—			—			—			1,342			37			1			—
Loans and financings – Current		—			18			19			3			19			—			—			15,568			9			10			—
Non-current		—			63			32			15			3			—			—			6,105			3,029			8			—
Equity		1,339			82			98			42			85			443			440			3,354			4,308			39			1,077

Total liabilities		1,339			173			163			62			110			443			440			14,330			8,411			79			1,077

		—			—			—			—			—			—			—			—			—			—			—
Statement of income		—			—			—			—			—			—			—			—			—			—			—
Net sales revenue		—			34			45			13			22			—			—			9,645			1,391			57			—
Cost of sales		—			(2	)		(19	)		(2	)		(1	)		—			—			(8,042	)		(149	)		(64	)		—
Depreciation and amortization		—			—			—			(1	)		—			—			—			(452	)		(1	)		(2	)		—

Gross profit (loss)		—			32			26			11			21			—			—			1,603			1,242			(7	)		—
General and administrative expenses (SG&A) :		(6	)		—			(1	)		—			(1	)		(1	)		(1	)		(753	)		(107	)		(8	)		(2	)
Finance income		4			2			1			4			1			—			1			148			58			1			—
Finance expenses		(60	)		(11	)		(5	)		(3	)		(4	)		(41	)		(41	)		(1,281	)		(223	)		—			(7	)

Operational profit (loss)		(62	)		23			21			12			17			(42	)		(41	)		(283	)		970			(14	)		(9	)
Income tax and the Social Contribution tax		—			(2	)		(2	)		(1	)		(1	)		—			—			(30	)		(108	)		5			—

Net income (loss) for the year		(62	)		21			19			11			16			(42	)		(41	)		(313	)		862			(9	)		(9	)

Comprehensive income (loss) effects		1			—			—			—			—			—			—			3			—			—			—

Comprehensive income (loss) for the year		(61	)		21			19			11			16			(42	)		(41	)		(310	)		862			(9	)		(9	)


2016	Hidrelétrica Cachoeirão			Baguari Energia			Guanhães Energia			Madeira Energia			Hidrelétrica Pipoca			Retiro Baixo			Renova			Central Eólica de Parajuru			Central Eólica de Morgado			Central Eólica Volta do Rio			Lightger			Amazônia Energia			Aliança Geração
Assets
Current		43			45			16			1,520			20			30			136			38			24			37			35			—			388
Cash and cash equivalents		40			11			1			58			17			19			36			18			17			27			32			—			147
Non-current		86			220			65			23,557			98			377			5,765			128			142			245			152			1,048			2,512

Total assets		129			265			81			25,077			118			407			5,901			166			166			282			187			1,048			2,900

		—			—			—			—			—			—			—			—			—			—			—			—			—
Liabilities		—			—			—			—			—			—			—			—			—			—			—			—			—
Current		9			12			191			3,131			8			25			3,347			19			27			37			16			—			592
Suppliers		2			6			—			662			—			1			547			1			1			1			6			—			101
Non-current		17			5			11			15,527			45			118			598			58			74			108			86			—			335
Equity		103			248			(121	)		6,419			65			264			1,956			89			65			137			85			1,048			1,973

Total liabilities		129			265			81			25,077			118			407			5,901			166			166			282			187			1,048			2,900

		—			—			—			—			—			—			—			—			—			—			—			—			—
Statement of income		—			—			—			—			—			—			—			—			—			—			—			—			—
Net sales revenue		34			65			—			2,803			25			62			484			27			22			29			36			—			804
Cost of sales		(10	)		(12	)		—			(1,845	)		(6	)		(29	)		(454	)		(17	)		(17	)		(27	)		(17	)		—			(314	)
Depreciation and amortization		(3	)		(9	)		—			(673	)		(3	)		(9	)		(93	)		(10	)		(10	)		(17	)		(11	)		—			(125	)

Gross profit (loss)		24			53			—			958			19			33			30			10			5			2			19			—			490
General and administrative expenses (SG&A)		—			(1	)		—			(146	)		(2	)		—			(41	)		(1	)		(1	)		(2	)		(1	)		(1	)		(58	)
Impairment of PP&E		—			—			—			—			—			—			(281	)		—			—			—			—			—			—
Adjustment for losses on investment		—			—			—			—			—			—			(455	)		—			—			—			—			—			—
Finance income		4			15			—			146			2			2			16			3			3			5			3			—			46
Finance expenses		(3	)		(1	)		(208	)		(1,552	)		(6	)		(15	)		(424	)		(7	)		(10	)		(15	)		(10	)		(8	)		(58	)

Operational profit (loss)		25			66			(208	)		(594	)		13			20			(1,155	)		5			(3	)		(10	)		11			(9	)		420
Income tax and the Social Contribution tax		(2	)		(7	)		—			(23	)		(2	)		(3	)		54			(2	)		1			3			(3	)		—			(127	)

Net income (loss) for the year		23			59			(208	)		(617	)		11			17			(1,101	)		3			(2	)		(7	)		8			(9	)		293

Comprehensive income (loss) effects		—			—			—			—			—			—			99			—			—			—			—			—			—

Comprehensive income (loss) for the year		23			59			(208	)		(617	)		11			17			(1,002	)		3			(2	)		(7	)		8			(9	)		293


2015	Parati			Transleste			Transirapé			Centroeste			Transudeste			Transchile			Light			Taesa			Axxiom			Aliança Norte			Cachoeirão
Assets
Current		59			47			34			58			32			39			3,976			2,082			74			1			28
Cash and cash equivalents		46			8			6			16			6			36			447			132			7			1			23
Non-current		1,408			128			114			1			81			299			11,818			7,574			14			726			89

Total assets		1,467			175			148			59			113			338			15,794			9,656			88			727			117

Liabilities
Current		36			18			20			4			17			21			4,399			1,008			34			—			10
Suppliers		—			—			—			—			—			—			1,450			34			2			—			2
Loans and financings – current		—			6			3			2			—			10			1,629			628			5			—
Non-current		—			84			49			21			23			96			6,838			3,477			5			4			24
Equity		1,431			73			79			34			73			221			4,557			5,171			49			723			83

Total liabilities		1,467			175			148			59			113			338			15,794			9,656			88			727			117

Statement of Income
Net sales revenue		—			33			34			14			22			28			1,222			1,973			66			—			30
Cost of sales		—			(4	)		(13	)		(4	)		(2	)		(10	)		(460	)		(287	)		(59	)		—			(14	)
Depreciation and amortization		—			—			—			(1	)		—			(9	)		(412	)		(15	)		(1	)		—			(3	)

Gross profit (loss)		—			29			21			10			20			18			762			1,686			7			—			16
General and administrative expenses		—			—			—			—			—			—			(91	)		—			(6	)		—			—
Net Finance income (expenses)		11			(9	)		(5	)		(3	)		(5	)		(6	)		(672	)		(562	)		—			(27	)		(1	)
Financial income		48			2			1			2			1			—			1,371			769			1			—			2
Finance expenses		(37	)		(11	)		(6	)		(5	)		(6	)		(6	)		(2,043	)		(1,331	)		(1	)		(27	)		(3	)

Operational profit (loss)		11			20			16			7			15			12			(1	)		1,124			1			(27	)		15
Income tax and Social Contribution tax		—			(2	)		(1	)		(1	)		(1	)		—			(40	)		(241	)		—			—			(2	)

Net income (loss) for the year		11			18			15			6			14			12			(41	)		883			1			(27	)		13

Comprehensive income (loss) effects		1			—			—			—			—			—			8			—			—			—			—

Comprehensive income (loss) for the year		12			18			15			6			14			12			(33	)		883			1			(27	)		13


2015	Baguari Energia			Guanhães Energia			Madeira Energia			Pipoca			Retiro Baixo			Renova			Parajuru			Morgado			Volta do Rio			Lightger			Amazônia Energia			Aliança Geração
Assets
Current		72			2			1,608			13			10			551			21			31			46			23			—			243
Cash and cash equivalents		9			1			300			—			1			66			12			12			20			14			—			70
Non-current		220			248			23,754			101			443			8,425			192			209			290			161			666			3,093

Total assets		292			250			25,362			114			453			8,976			213			240			336			184			666			3,336

Liabilities
Current		16			212			2,151			10			25			1,497			18			28			36			14			—			113
Suppliers		6			—			384			—			6			570			—			—			1			4			—			36
Non-current		6			—			15,569			50			132			1,898			66			85			126			94			—			274
Equity		270			38			7,642			54			296			5,581			129			127			174			76			666			2,949

Total liabilities		292			250			25,362			114			453			8,976			213			240			336			184			666			3,336

Statement of Income
Net sales revenue		59			—			2,605			22			53			458			31			34			47			32			—			797
Cost of sales		(46	)		—			(1,103	)		(11	)		(40	)		(5	)		(16	)		(18	)		(28	)		(25	)		—			(442	)
Depreciation and amortization		(9	)		—			(471	)		(3	)		(9	)		(4	)		(10	)		(10	)		(17	)		(10	)		—			(69	)

Gross profit (loss)		13			—			1,502			11			13			453			15			16			19			7			—			355
General and administrative expenses		—			(86	)		(816	)		(2	)		(11	)		—			(5	)		(6	)		(2	)		(1	)		(2	)		(69	)
Net Finance income (expenses)		9			(14	)		(967	)		(3	)		(13	)		(355	)		(5	)		(8	)		(11	)		(7	)		(23	)		(18	)
Financial income		10			—			950			2			1			41			2			2			3			2			—			9
Finance expenses		(1	)		(14	)		(1,917	)		(5	)		(14	)		(396	)		(7	)		(10	)		(14	)		(9	)		(23	)		(27	)

Operational profit (loss)		22			(100	)		(281	)		6			(11	)		98			5			2			6			(1	)		(25	)		268
Income tax and Social Contribution tax		(5	)		—			266			(1	)		1			(191	)		(1	)		(1	)		(2	)		(2	)		—			(30	)

Net income (loss) for the year		17			(100	)		(15	)		5			(10	)		(93	)		4			1			4			(3	)		(25	)		238

Comprehensive income (loss) effects		—			—			—			—			—			54			—			—			—			—			—			—

Comprehensive income (loss) for the year		17			(100	)		(15	)		5			(10	)		(39	)		4			1			4			(3	)		(25	)		238

Investment in the Santo Antônio hydroelectric plant, through Madeira Energia S.A. (‘Mesa’) and FIP Melbourne

The Company has a direct and indirect investments, of 10% and 8.13% respectively, in Madeira Energia S.A. (which holds an investment in Santo Antônio Energia S.A.), of R$ 1,117 at December 31, 2017 (R$ 1,321 at December 31, 2016).

Madeira Energia S.A. (‘Mesa’) and its subsidiary Santo Antônio Energia S.A. (‘Saesa’) are incurring construction costs related to the construction of the Santo Antônio hydroelectric plant. Total construction costs related to amounted to R$ 21,611 (Mesa, consolidated) on December 31, 2017. According to financial projections prepared by its management, such construction costs will be recovered through future revenues from operations as all the entity’s generation plants are currently under operation.

The Federal Public Attorneys’ Office, have conducted and are in the process of conducting investigations and other legal measures are in progress, involving other indirect Shareholders of Madeira Energia S.A. and certain executives of those other indirect Shareholders. In this context, the Federal Public Attorneys have started investigations on irregularities involving contractors and suppliers of Mesa and of its other Shareholders. In response to allegations of possible illegal activities, the investee and its other Shareholders have started an independent internal investigation. It is not possible to determine the results of these investigations, or the developments arising from them, which may at some time in the future affect the investee.

The effects of any changes to the current scenario will be reflected, appropriately, in the financial statements of the Company and its subsidiary Cemig GT.

Arbitration proceedings

In 2014, Cemig GT and SAAG Investimentos S.A. (SAAG), a vehicle through which Cemig GT holds an indirect equity interest in Mesa, opened arbitration proceedings, in the Market Arbitration Chamber, challenging the following: (a) the increase approved in the capital of Mesa of approximately R$ 750 partially to be allocated to payment of the claims by the Santo Antonio Construction Consortium (‘CCSA’), based on absence of quantification of the amounts supposedly owed, and absence of prior approval by the Board of Directors, as required by the bylaws and Shareholders’ Agreement of Mesa; and also on the existence of credits owed to Mesa by CCSA, for an amount greater than the claims; and (b) the adjustment for impairment carried out by the Executive Board of Mesa, in the amount of R$ 750, relating to certain credits owed to Mesa by CCSA, on the grounds that those credits are owed in their totality by express provision of contract.

The arbitration judgment by the Market Arbitration Chamber recognized the right of Cemig GT and SAAG in full, and ordered the annulment of the acts being impugned. As a consequence of this decision, Mesa reversed the impairment, and posted a provision for receivables in the amount of R$ 679 in its financial statements as of December 31, 2017.

To resolve the question of the liability of the CCSA consortium to reimburse the costs of re-establishment of the collateral and use of the contractual limiting factor, the affiliated company opened arbitration proceedings with the International Chamber of Commerce (ICC) against CCSA, which are in progress. This process is confidential under the Arbitration Regulations of the ICC.

Investment in the Belo MontePlant through Amazônia Energia S.A. and Aliança Norte

Amazônia Energia and Aliança Norte are Shareholders in Norte Energia S.A. (‘Nesa’), which holds the concession to operate the Belo Monte Hydroelectric Plant, on the Xingu River, in the State of Pará, and manages that interest. Through the jointly-controlled entities referred to above, Cemig GT owns an indirect equity interest in Nesa of 11.74%.

Nesa will still require significant funds for costs of organization, development and pre-operating costs for completion of the plant. According to estimates and forecasts, these costs will be recovered through revenues from future operations.

On April 7, 2015, Nesa was awarded a preliminary injunction ordering the regulator to “abstain, until hearing of the application for an injunction made in the original case, from applying to Appellant any penalties or sanctions in relation to the Belo Monte Hydroelectric Plant not starting operations on the date established in the original timetable for the project, including those specified in an Aneel Normative Resolution and in the Concession Contract for the Belo Monte Hydroelectric Plant”. The legal advisers of Nesa have classified the probability of loss as ‘possible’ and estimated the potential loss on December 31, 2017 to approximately R$ 286 (R$ 74 on December 31, 2016).

Investigations and other legal measures are in progress, conducted by the Federal Public Attorneys’ Office, which involve other Shareholders of Nesa and certain executives of those other Shareholders. In this context, the Federal Public Attorneys have started investigations on irregularities involving contractors and suppliers of Nesa and of its other Shareholders, which are still in progress. At present it is not possible to determine the outcome of these investigations, and their possible consequences. These might at some time in the future affect the investee. In addition, based on the results of the independent internal investigation conducted by Nesa and its other Shareholders, a write-down of the value of the infrastructure of Nesa, by R$ 183 was already recorded.

The effects of any changed in the current scenario will be reflected, appropriately, in the financial statements of the Company.

Investment in Renova Energia S.A. (‘Renova’)

Investment in TerraForm

The indirectly jointly-controlled entity Renova had investments in TerraForm Global Inc., designated as financial assets available for sale, recorded at fair value, based on the quoted market price of the shares of TerraForm on a stock exchange (NASDAQ), of which the gain arising from the change in the quoted price of the shares (fair value), in the amount of R$ 73, was recorded in Other comprehensive income in the jointly-controlled entity.

On May 15, 2017, Renova sold to Brookfield Asset Management (‘Brookfield’) the investment that it held in TerraForm Global Inc. (‘TerraForm Global’), for R$ 306, and reclassified the accumulated positive adjustments previously posted in Other comprehensive income, in the amount of R$ 172 (of which the impact on Cemig GT was R$ 60), to the Statement of income.

In June 2017 Renova further signed an agreement with TerraForm Global in which the parties agreed to terminate the arbitration proceedings that were in existence between the parties, through financial compensation to Renova of R$ 49. This was paid jointly with the settlement of the sale of the shares of TerraForm.

Adjustment for impairment

In 2017 and 2016 Renova posted impairments of its PP&E, resulting in the recognition of an impairment loss of R$ 787, (the impact on Cemig GT being R$ 285), and R$ 264 (impact on Cemig GT: R$ 90), respectively.

Sale of assets – Umburanas wind complex

On August 23, 2017 Renova signed, with Engie Brasil S.A. (‘Engie’), the Contract for Assignment of Rights and Obligations of the Umburanas Wind Power Complex, with total installed capacity of 605 MW. The base price of the transaction was R$ 15.

The transfer of the Umburanas Complex to Engie was approved on October 24, 2017, at the 40^th Public Meeting of the Council of Aneel.

Grant of exclusivity

On February 23, 2018, Renova received a binding offer from Brookfield Energia Renovável S.A. (‘BER’) for acquisition of the assets of the whole Alto Sertão III Complex (‘ASIII Complex’), and also approximately 1.1 GW in certain wind projects under development. The value presented for the ASIII Complex was R$ 650 , to be paid on completion of the transaction, this amount being subject to usual post-closing adjustments (‘the Price’). The Price may be increased by an earn-out of up to R$ 150 linked to future generation by the ASIII Complex, to be calculated after 5 years from its start of operation, plus R$ 187 per MW of installed capacity for the wind projects in development. On February 27, 2018 the Board of Directors of Renova approved the proposal received and granted BER exclusivity for a further 30 (thirty) days, automatically renewable for 30 (thirty) additional days, for finalization of the documents of the transaction. The proceeds from the transaction will be prioritized for payment of suppliers and creditors of the Alto Sertão III project.

Risks related to compliance with laws and regulations

On January 19, 2018, Renova responded to a formal statement by the Civil Police of Minas Gerais State received in November 2017, relating to the investigation being carried out by that Police Force related to certain capital injections made by the equity holders of the parent of Renova, and capital injections made by Renova in certain projects under development in previous years. As a consequence, the governance bodies of Renova requested the opening of an internal investigation, which is being conducted by an independent party.

The investigation is in progress, and it is not possible to determine any effects of this investigation, nor any impacts on the financial statements of Renova, of the Company for the year ended December 31, 2017.

Binding proposal by Cemig presented to Renova

On March 27, 2018 Cemig (the equity holder of Cemig GT) presented a binding proposal to the jointly-controlled entity Renova, for acquisition of 100% of the shares in Chipley SP Participações S.A. (‘Chipley’) held by Renova, or 51% of the shares in Brasil PCH S.A. held by Chipley.

This proposal relates to the recent changes in the negotiations for capitalization of Renova, Renova’s interest in bringing forward revenues from power purchase agreements, and execution of Cemig’s disinvestment program.

Cemig’s intention is that Renova should sell its interest in Brasil PCH to a third party, or to Cemig or to any of its affiliated companies, in the terms of the Proposal, to make possible payment of the amounts owed to Cemig GT.

Completion of this transaction, if accepted by Renova, will be subject to precedent conditions, specified in the Proposal, that are customary in this type of transaction.

In view of the above, Cemig GT has not participated in the governance bodies of Renova in relation to any decision and debate relating to the binding proposal.

Interest in RME and Lepsa

On November 30, 2017, the Company made an additional acquisition of an interest in RME, acquiring control of that company as a result of partial exercise of the put option held by the other Shareholders, as descried in more detail in Note 30 – Financial Instruments and Risk Management.

On that date Cemig acquired all of the outstanding shares in Lepsa, and all of the outstanding preferred shares in RME, held by BB-BI, BV Financeira and Santander, which corresponded to fair value of R$ 185, comprising R$ 147 in Lepsa and R$ 38 in RME.

With this acquisition, Cemig increased its interestship in RME from 66.27% to 75% of the total capital, while continuing to own a 50% interest in the voting shares of RME; and increased in interestship in Lepsa from 66.62% to 100% of the total and voting.

The fair value of the assets acquired are as follows:


Lepsa			RME
	ASSETS	LIABILITIES + EQUITY		ASSETS	LIABILITIES + EQUITY
Fair value, current	4	—	Fair value, current	2	—
Fair value, non-current	428	—	Fair value, non-current	428	—
Fair value, equity	—	432	Fair value, equity	—	430

Total	432	432	Total	430	430

Considering its acquisition of control of Lepsa, Cemig measured its original participation in the investment at fair value, recognizing a loss of R$ 72 during in 2017.

Merger of Cemig Telecom

On February 28, 2018, Company shareholders’ Meeting approved the merger of Cemig Telecom that was completed on March 31, 2018.

Since this is an merger of a wholly-owned subsidiary, there was no capital increase nor issue of new shares by Cemig. The shares in the subsidiary were canceled, on the merger date, and the necessary accounting adjustment were made.

Disposal Taesa’s units

In November 2017 the Company sold part of its equity interest in the jointly-controlled entity Taesa in an auction and raised R$ 717. The Company sold 34 million Units of Taesa at the price of R$ 21.10 per Unit. With the sale, the Company’s holding in the share capital of Taesa was reduced from 31.54% to 21.68%.

The shares that were sold are not part of the controlling shareholding block of Taesa, and as a result Cemig continues to be in the controlling block of Taesa.

Sale of the Transmineiras to Taesa

In november 2017, Cemig completed the shareholding restructuring involving transfer to Taesa of the equity interests held by Cemig GT in the following transmission concession holders:

•

Companhia Transleste de Transmissão S.A. (‘Transleste’),

•

Companhia Transudeste de Transmissão S.A. (‘Transudeste’), and

•

Companhia Transirapé de Transmissão S.A. (‘Transirapé’)

(‘the Transmineiras Companies’). The amount received by Cemig was R$ 56.