Concession Financial and Sector Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Financial Assets and Liabilities of Concession


Concession financial assets	2018		2017
Financial assets (15.1)
Distribution concessions		396		371
Indemnifiable receivable – Transmission (15.2)		1,296		1,928
Transmission concessions (15.3)		—		547
Indemnifiable receivable – Generation (15.4)		816		1,901
Concession grant fee – Generation concessions (15.5)		2,409		2,337

		4,917		7,084


Concession sector assets	2018		2017
Amounts receivable from Parcel A (CVA) and Other Financial Components (15.6)		1,081		369

Total		5,998		7,453

Current assets		1,071		848
Non-current assets		4,927		6,605


Concession sector liabilities	2018		2017
Amounts payable from Parcel A (CVA) and Other Financial Components (15.6)		—		415
Current liabilities		—		415

Summary of Changes in Concession Financial Assets Related to Infrastructure

The changes in concession financial assets related to infrastructure are as follows:


	Transmission			Generation			Distribution			Total
Balances at December 31, 2016		2,287			2,800			216			5,303

Additions		25			—			—			25
Transfers of indemnity – plants not renewed		—			1,082			—			1,082
Amounts received		(264	)		(232	)		—			(496	)
Transfers between PP&E, Financial assets and Intangible assets		2			—			146			148
Monetary updating		224			317			—			541
Adjustment of expectation of cash flow from the Concession financial assets		54			—			9			63
Disposals		(2	)		—			—			(2	)
Adjustment of BRR of Transmission Assets		149			—			—			149
Adjustment on indemnities of plants not renewed (Ministerial Order 291) – including financial updating		—			271			—			271

Balances at December 31, 2017		2,475			4,238			371			7,084

Effects of first-time adoption of IFRS (15.1, 15.3)		(1,092	)								(1,092	)
Amounts received		(249	)		(1,389	)					(1,638	)
Transfers between PP&E and concession contract assets		—						27			27
Others transfers		—			(1	)		(1	)		(2	)
Monetary updating		162			377			—			539
Disposals		—			—			(1	)		(1	)

Balances at December 31, 2018		1,296			3,225			396			4,917

Summary of Generation Indemnity Receivable


Generation plant	Concession expiration date		Installed capacity (MW)		Net balance of assets based on historical cost		Net balance of assets based on fair value (replacement cost)
Lot D
UHE Três Marias		July 2015		396		72		413
UHE Salto Grande		July 2015		102		11		39
UHE Itutinga		July 2015		52		4		7
UHE Camargos		July 2015		46		8		23
PCH Piau		July 2015		18.01		1		9
PCH Gafanhoto		July 2015		14		1		10
PCH Peti		July 2015		9.4		1		8
PCH Dona Rita		Sep. 2013		2.41		1		1
PCH Tronqueiras		July 2015		8.5		2		12
PCH Joasal		July 2015		8.4		1		8
PCH Martins		July 2015		7.7		2		4
PCH Cajuru		July 2015		7.2		4		4
PCH Paciência		July 2015		4.08		1		4
PCH Marmelos		July 2015		4		1		4
Others
UHE Volta Grande		Feb. 2017		380		26		70
UHE Miranda (1)		Dec. 2016		408		27		23
UHE Jaguara (1)		Aug. 2013		424		40		174
UHE São Simão (1)		Jan. 2015		1,710		1		3

				3,601.70		204		816

(1)

Investments made after the Jaguara, São Simão and Miranda plants came into operation, in the amounts of R$174, R$3 and R$ 23, respectively, are recorded as concession financial assets, and the determination of the final amounts to be paid to Cemig GT is in a process of discussion with the regulator (Aneel). Management does not expect losses in realization of these amounts.

Summary of Auction Won Transferred to Related Specific Purpose Companies

The changes in concession financial assets are as follows:


SPE	Plants	2017		Monetary updating		Amounts received			2018
Cemig Geração Três Marias S.A.	Três Marias		1,330		174		(134	)		1,370
Cemig Geração Salto Grande S.A.	Salto Grande		417		55		(42	)		430
Cemig Geração Itutinga S.A.	Itutinga		156		23		(18	)		161
Cemig Geração Camargos S.A.	Camargos		116		17		(13	)		120
Cemig Geração Sul S.A.	Coronel Domiciano, Joasal, Marmelos, Paciência e Piau		152		24		(19	)		157
Cemig Geração Leste S.A.	Dona Rita, Ervália, Neblina, Peti, Sinceridade e Tronqueiras		103		18		(14	)		107
Cemig Geração Oeste S.A.	Cajurú, Gafanhoto e Martins		63		11		(10	)		64

Total			2,337		322		(250	)		2,409


SPE	Plants	2016		Monetary updating		Amounts received			2017
Cemig Geração Três Marias S.A.	Três Marias		1,283		172		(125	)		1,330
Cemig Geração Salto Grande S.A.	Salto Grande		403		54		(40	)		417
Cemig Geração Itutinga S.A.	Itutinga		150		23		(17	)		156
Cemig Geração Camargos S.A.	Camargos		112		17		(13	)		116
Cemig Geração Sul S.A.	Coronel Domiciano, Joasal, Marmelos, Paciência, Piau		147		23		(18	)		152
Cemig Geração Leste S.A.	Dona Rita, Ervália, Neblina, Peti, Sinceridade, Tronqueiras		99		17		(13	)		103
Cemig Geração Oeste S.A.	Cajurú, Gafanhoto, Martins		60		11		(8	)		63

Total			2,254		317		(234	)		2,337

Summary of Financial Assets and Financial Liabilities With the Tariff Adjustments

The balance of these sector financial assets and liabilities, which are presented at net value, in assets or liabilities, in accordance with the tariff adjustments that have been authorized or are to be ratified, are as follows:


	2018									2017
Balance sheet	Amounts ratified by Aneel in the last tariff adjustment			Amounts to be ratified by Aneel in the next tariff adjustments			Total			Amounts ratified by Aneel in the last tariff adjustment			Amounts to be ratified by Aneel in the next tariff adjustments			Total
Assets		1,184			2,545			3,729			382			2,331			2,713
Current assets		1,184			1,505			2,689			382			1,379			1,761
Non-current assets		—			1,040			1,040			—			952			952
Liabilities		(1,140	)		(1,509	)		(2,649	)		(797	)		(1,962	)		(2,759	)
Current liabilities		(1,140	)		(902	)		(2,042	)		(797	)		(1,221	)		(2,018	)
Non-current liabilities		—			(607	)		(607	)		—			(741	)		(741	)

Total current, net		44			603			647			(415	)		158			(257	)

Total non-current, net		—			433			433			—			211			211

Total, net		44			1,036			1,080			(415	)		369			(46	)

	2018									2017
Financial components	Amounts ratified by Aneel in the last tariff adjustment			Amounts to be ratified by Aneel in the next tariff adjustments			Total			Amounts ratified by Aneel in the last tariff adjustment			Amounts to be ratified by Aneel in the next tariff adjustments			Total
Items of ‘Parcel A’
Energy Development Account (CDE) quota		1			220			221			(154	)		(90	)		(244	)
Tariff for use of transmission facilities of grid participants		24			(6	)		18			9			24			33
Tariff for transport of Itaipu supply		2			16			18			2			2			4
Alternative power source program (Proinfa)		3			5			8			(5	)		1			(4	)
ESS/EER System Service/Energy Charges		(246	)		(287	)		(533	)		(40	)		(587	)		(627	)
Energy bought for resale (1)		667			1,402			2,069			(91	)		1,327			1,236
Other financial components
Over contracting of supply		(204	)		(13	)		(217	)		8			(211	)		(203	)
Neutrality of Parcel A		53			(15	)		38			(30	)		73			43
Other financial items		(236	)		(212	)		(448	)		(112	)		—			(112	)
Tariff Flag balances (2)		—			(11	)		(11	)		—			(134	)		(134	)
Excess demand and reactive power		(21	)		(62	)		(83	)		(2	)		(36	)		(38	)

TOTAL		43			1,037			1,080			(415	)		369			(46	)

(1)

The amount of the CVA for energy supply constituted in 2018 after the Tariff Review, for inclusion in the tariff adjustment of 2019, is due mainly to the increased expenses on purchase of energy and coverage of hydrological risk, in view of the increase in the price of energy in the wholesale market, and operation of the thermoelectric plants due to the low level of reservoirs.

(2)	Billing arising from the ‘Flag’ Tariff System not yet homologated by the regulator (Aneel).

Summary of Changes in Balances of Financial Assets and Liabilities

Changes in balances of financial assets and liabilities:


Balance at December 31, 2015	1,350
Net constitution of financial liabilities	(858	)
Amortization	(597	)
Payments from the Flag Tariff Centralizing Account	(341	)
Transfer	(165	)
Updating – Selic rate	204

Balance at December 31, 2016	(407	)
Additions	811
Amortization	177
Payments from the Flag Tariff Centralizing Account	(586	)
Updating – Selic rate	(41	)

Balance at December 31, 2017	(46	)

Additions (1)	1,638
Amortization	335
Others – R&D Reimbursement (2)	(115	)
Payments from the Flag Tariff Centralizing Account	(794	)
Updating – Selic rate (Note 30)	62

Balance at December 31, 2018	1,080

(1)

The CVA asset recognized in the period is mainly due to higher difference in 2018 between actual costs of energy and the estimate figures used for future cost of energy in the tariff calculation (this difference generates a financial asset to be reimbursed to the Company through the next tariff adjustment).

(2)

Refers to reimbursement of the additional tax collected, of 0.3% of net operating revenue passed through to energy tariffs and paid to the National Treasury from January 2010 to December 2012. The aim of this collection was to reimburse states and municipalities for any loss of ICMS tax revenue, applying to fossil fuels used in the generation of energy in the 24 months following connection of the related isolated systems to the National Grid.

Miranda and Sao Simao hydroelectric plants [member]

Statement [LineItems]

Summary of Generation Indemnity Receivable


Plant	Miranda			São Simão			Total
Residual value of assets on 2017 based on deemed cost		610			203			813
Adjustment regarding MME Order 291/17		174			41			215

Amounts based on MME Order 291/17		784			244			1,028
Monetary adjustment		25			31			56

Residual value of assets of Basic Plans at Dec. 31, 2017		809			275			1,084
Monetary adjustment (1)		42			13			55
Amounts received		(851	)		(288	)		(1,139	)

Residual value of assets of Basic Plan at Dec. 31, 2018		—			—			—

(1)	Inflation adjustment, net of transfers, of R$ 323