CPFL Energia S A : Financial Statements * 4Q23

Management Report

Dear Shareholders,

In compliance with the law and the Bylaws of CPFL Energia S.A. ("CPFL Energia" or "Company"), the Management of the Company hereby submits to you the Management Report and financial statements of the Company, along with the reports of the independent auditor and Fiscal Council for the fiscal year ended December 31, 2023. All comparisons herein are made with consolidated figures for fiscal year 2022, except when specified otherwise.

1. Opening remarks

The year 2023 was marked by the El Niño phenomenon, characterized by the abnormal warming of the Pacific Ocean, which could cause torrential rains in Southern Brazil and severe drought in the North and Northeast regions, which would favor winds in the region. We also observed periods of intense heat all over Brazil, resulting in a significant increase in consumption demand from the residential and commercial segments, which contributed to the healthy results of the Distribution segment.

On the other hand, this climate scenario imposed more challenges on the Generation segment, since power plants needed to be dispatched to meet the increased demand while the wind and solar power plants in the Northeast region had to be disconnected from the grid, showing the formidable difficulties being faced by the National Electric System Operator (ONS) in operating the system.

The CPFL Energia group continued to actively pursue sustainable growth in its segments, investing R$5.1 billion in the year to further improve the performance of its distribution assets by extending the networks and deploying new technologies in order to continue offering top quality services to its clients. It also made investments in plant maintenance and retrofitting projects at the transmission networks to achieve excellence in operational management.

With regard to investments, another important fact was the operational startup of transmission projects Sul I, Sul II and Cachoeirinha 3, comprising new substations and about 382 km of transmission lines, located in the state of Rio Grande do Sul, with RAP of R$ 87 million for the 2022-2023 cycle.

Still in the transmission segment, it is worth highlighting the excellent results obtained from the acquisition of CPFL Transmissão. After swapping the debt in U.S. dollar and revising the contracts, we identified new opportunities for investments in maintenance and retrofitting projects, which are currently pending approval by the regulatory authority, and represent potential future revenues that surpass our initial expectations.

Our expansion also reached other businesses of the CPFL Group, such as the Trading and Services segment, in which we launched our e-commerce business, whereby CPFL Soluções now has a digital platform for clients to directly acquire the four key products on offer: short-term energy contracts, purchase of carbon credits, purchase of I-REC certificates and migration to the free market.

We also advanced with Alesta, the group's fintech arm, which now offers credit to clients in the concession areas of all our distributors: CPFL Paulista, CPFL Piratininga, RGE and CPFL Santa Cruz.

The outlook for the coming years remains highly positive. In late 2023, the Board of Directors of CPFL Energia approved the Group's new 2024-2028 Investment Plan, which entails the

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allocation of R$28.4 billion to existing businesses, notably R$23.4 billion to the distribution segment and R$3.5 billion to the transmission segment.

On the ESG front, the Company's stock remained in the portfolio of B3's Corporate Sustainability Index (ISE). Also, the ESG 2030 Plan started to be executed in 2023. This platform, approved by the Board of Directors and disclosed to all stakeholders in 2022, gathers the guidelines and strategies for CPFL to provide sustainable, accessible and reliable energy at all times, making people's lives safer, healthier and prosperous in the regions where we operate.

With 23 commitments organized around four pillars, the ESG 2030 Plan, annually updated in an integrated manner with the company's Strategic Planning, continues the strategic management efforts launched in 2019, when the first sustainability plan was structured, and whose targets and commitments have already been met. With a broader scope and a long-term perspective, the ESG 2030 Plan drives businesses to expand their contribution to the UN 2030 Agenda and Sustainable Development Goals (SDG). Highlights of the plan include commitments suach as generation 100% renewable energy, achieving carbon neutrality as of 2025, reduction of total emissions by 56% by 2030 and achieving at least 85% of our spending with partners who present advanced practices in sustainability.

Financial discipline, which has always been a hallmark of CPFL Energia, once again guides our capital allocation decisions. In relation to the 2022 results, we paid dividends of R$3.3 billion to shareholders in the period between December 2022 and December 2023.

Lastly, the management of CPFL Energia reaffirms its commitment and confidence to the shareholders, clients, partners, society and other stakeholders, and thanks all the CPFL Group employees for the results achieved. For 2024, we remain optimistic about the advances in Brazil's electricity sector and are confident about our business platform while being prepared to face the emerging challenges and opportunities in the country.

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Shareholders' Structure (simplified)

CPFL Energia is a holding company that owns stake in other companies:

Reference date: 12/31/2023

Notes:

1. RGE is held by CPFL Energia (89.0107%) and CPFL Brasil (10.9893%);
2. CPFL Renováveis is controlled by CPFL Energia (49.1502%) and CPFL Geração (50.8498%);
3. CPFL Piracicaba, CPFL Morro Agudo, CPFL Maracanaú, CPFL Sul I e CPFL Sul II are consolidated in CPFL Geração.
4. CPFL Soluções = CPFL Brasil + CPFL Serviços;
5. Alesta is controlled by CPFL Energia (99.99%) and by CPFL Brasil (0.01%).

2. Comments on the macroeconomic and regulatory scenario

Macroeconomic scenario

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The year 2023 began with signs of slow growth and increased inflation. Expectations according to the Focus Survey were between 0.8% and 5.3% respectively. It was expected that the end of tax holiday would affect administered prices, especially of fuels, maintaining inflation high despite the negative effects of interest rate hike on economic activity. However, there were mild surprises on both fronts: economic growth was stronger and inflation was lower.

Among the factors that contributed to better than expected performance were the normalization of production chains and the decrease in commodity prices, due to deflation in Brazil and abroad.

The record domestic harvest - much higher than initial expectations - contributed directly (with nearly 1.2 p.p.) and indirectly to stronger GDP (through the multiplier effects of income generated in the sector).

The bumper agricultural supply also helped reduce domestic prices, especially food prices; in fact, 2023 registered deflation of the Food at Home group in IPCA. As such, despite the resumption of taxes on fuels and higher inflation of administered prices in the year (9.2%), inflation ended the year at 4.62%, within the target range, whose ceiling is 4.75%.

The year 2023 also witnessed discussions about the inflation target and autonomy of the Central Bank of Brazil, which led to the unanchoring of inflation expectations in longer terms, especially during the first half of the year. When it became clear that the autonomy of the Central Bank of Brazil and inflation target of 3% would be maintained - now changed to a continuous target - these expectations were partially reanchored to around 3.5%, slightly above the center of the inflation target.

One of the reasons for the partial reanchoring of the inflation expectations is the fiscal issue. The year saw significant advances in this aspect, such as the approval of the new Tax Framework and measures to boost revenues in 2024. But there is still much uncertainty about compliance with/changes to these targets, which should continue to be a point of concern during 2024.

While expectations related to inflation remained under pressure and the international and domestic environment were not clear, the Central Bank of Brazil kept the interest rate unchanged. Selic started to be reduced only when the deflation process became clearer and signs of core decompression appeared, but the impacts of the moderation of monetary restrictions are expected to be fully observed only in 2024, given the usual lags.

The stronger GDP in 2023 also included the expansion of household incomes benefited by a strong labor market, with increase in both jobs and real average income of employees, as well as increased government transfers through the family allowance (Bolsa Família) program. Income growth was important to ensure the healthy performance of the retail segment that most depends on it; on the other hand, the retail segment that is more related to credit faced greater difficulties due to increased defaults, very high interest rates and record household debts. Default decreased in the second half of the year, fueled by the Desenrola program, but the recovery of this market is still incipient and should become stronger during 2024, reflecting the reduction of Selic. In the retail segment that depends more on credit, the positive highlight was automobile sales driven by specific government programs.

However, the year was difficult for industry. Although mineral extraction has been doing well, the manufacturing industry reflected both lower demand and the difficulties faced by companies to obtain credit. In addition to an increased Selic rate, the episode involving the accounting reclassifications at the Americanas retail chain at the start of the year forced banks and capital markets to exercise greater caution. The situation only started to improve in the second half of the year, with the monetary easing and the perception that the accounting episode was restricted to Americanas. This improvement should last in 2024.

The Brazilian real remained under pressure in the first half of the year, while doubts swirled about the fiscal issue and the autonomy of the Central Bank of Brazil, but improved slightly these questions were addressed. The foreign exchange oscillations also reflected the market's mood in relation to the international economy; 2023 was a year of interest rate hikes in leading global economies and expectations that the rates would remain on a downward trend for a long time prevailed throughout most of the second half of the year. However, in December these expectations partially lost ground when the markets started to bet on sharper interest rate cuts

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during 2024, which contributed to the depreciation of the U.S. dollar against other currencies, including the Brazilian real.

Another significant fact at the end of the year deserves mention: the announcement of tax reforms. The pillars of the reforms are the implementation of a broad and non-cumulative tax base system; standardized legislation; heavy simplification of the system; and also a limited number of exceptions, even though more than desirable. As a result, the new system should be less complex than the current one and with less incentive to litigation, causing a reduction in allocative distortions and increasing the productivity of the Brazilian economy. In the wake of the reforms approved in 2023, Brazil's debt risk rating was upgraded by S&P, which helped consolidate the appreciation of the real in the final days of the year.

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Regulatory Environment

The key changes in sector regulations in the distribution segmentin 2023 are outlined below:

1) Regulation of PIX as a payment method for electricity bills

Result of Public Consultation ("CP") 042/2022, ANEEL Normative Resolution ("REN") 1,057, of January 24, 2023, defined that, in up to 120 days from its publication, distributors are obliged to provide PIX as a method for paying electricity bills, whenever consumers request this option. Distributors can also make the QR Code available for PIX payment, irrespective of the consumer request, which, in fact, was already in practice at various energy concessionaires and licensees. However, since many distributors did not offer that option or offered it with restrictions, the Brazilian Electricity Regulatory Agency ("ANEEL") decided to regulate the issue to ensure equal treatment for all consumers in Brazil, irrespective of the management model adopted by their energy distributor.

1. Regulation of economic aspects of Law 14,300/2022 (Legal Framework of Distributed Micro- and Mini-Generation)

Result of CP 050/2022, ANEEL REN 1,060, published on February 7, 2023, approved the changes in Modules 5 (Sector Charges) and 7 (Tariff Structure) of the Tariff Regulation Procedures ("PRORET") to adapt them to Law 14,300/2022, which changed how the public policy apportionment of costs is made and defines new obligations for distributors.

Among the main changes are: the creation of the Energy Development Account - Distributed Generation (CDE-GD) quota and its inclusion in the annual budget of the CDE; changes in the tariff structure; and the systematic submission of new information by distributors to give transparency to costs that distributed generation represents in the distribution system.

The changes were implemented in 2023, in both the CDE budget and in the distributors' tariff processes. For the coming years, the tariff benefits borne by the CDE (for new and existing consumers of distributors with less than 700 GWh) will be calculated based on the amounts effectively transferred monthly, as established in the ratification resolutions of the tariff processes of each distributor, adjusted by the IPCA and, in the case of tariff benefits for new consumers, adjusted by the projected installed capacity of the GD.

1. Regulation of the technical aspects of Law 14,300/2022 (Legal Framework of MMGD)

Result of CP 051/2022, ANEEL REN 1,059, published on February 7, 2023, regulated the legal framework for Distributed Micro- and Mini- Generation ("MMGD"), improving the rules for connection and billing, and for the Electricity Compensation System, amending RENs 920, of February 23, 2021, 956, of December 7, 2021, 1,000 of December 7, 2021, 1,009, of March 22, 2022, and establishing other measures. The main aspects regulated were:Measurement Systems: For these units of Group A, as of January 1, 2024, measurement systems should have additional functionalities to measure the voltage levels and continuity indicators, as established in Module 5 of the Distribution Procedures ("PRODIST");

• Guarantee of faithful compliance: Article 4 of Law 14,300/2022 created the obligation that those interested in the connection of mini-generation stations starting from 500kW of installed capacity (2.5% of the investment amount, from 500 to 1,000 kW, and 5% above 1,000 kW) must submit the guarantee of faithful compliance (GFC). According to the new regulation, consumers can opt, exclusively, for one of the following modalities: cash deposit, book-entry public debt securities registered with the centralized settlement and custody system authorized by the Central Bank of Brazil, or bank guarantee issued by a bank or financial institution duly authorized to operate in the country by the Central

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Bank of Brazil, in which case, the distributor should list at least four banks or financial institutions to be chosen by the mini-generator.

1. • Prohibition of division of the Power Generation Plant: It was included in the regulation an express criterion included in Law 14,300/2022, prohibiting the division of the power generation plant into smaller units in order to be classified under the installed capacity limits of the distributed micro- or mini-generation.The new regulation assigns the distributor the responsibility for identifying cases of division of power generation plant that do not comply with ANEEL provisions and the Law. The prohibition does not change the rights and obligations applicable to the consumer unit with distributed micro- or mini- generation, nor does it apply to the floating power generation plant with photovoltaic source installed on the surface of the nappe of water reservoirs, dams and lakes, natural or artificial, provided each power generation plant resulting from the division meets the criteria established;
   • Distributor's pending issue - Construction deadline: The Agency decided that the classification of the agent as GD type I is possible when the connection is made no later than the deadline established in article 26 of Law 14,300/2022 or the deadline established in the connection budget, always considering the furthest of the two. Law 14,300/2022 established the following deadlines: 120 days for distributed micro-generators,irrespective of the source; 12 months for mini solar generators or 30 months for mini- generators of other sources;
   • Collection for power injection - Type of collection: Article 18 of Law 14,300/2022 established guidelines for billing the cost of transportation of distributed micro- and mini- generators. It was established that for units served by Group B the due will be payable only after installation of the meter to calculate the demand from generation, at the discretion of the distributor. For units of Group A, whose meter already includes the calculation of generation demand, the billing for injection starts in these units after the deadline for implementation of the regulation;
   • Opting for Group B: Law 14,300 established that the consumer units with local generation, whose total nominal output of transformers is equal to or lesser than one and a half times the limit permitted for connecting group B consumers, may opt for billing identical to the low voltage units connected, according to ANEEL regulation. Therefore, it was determined that, for the option for billing in Group B to become effective, it is necessary that the sum of the output of transformers does not exceed 112.5 KVA; that the generation be installed in the consumer unit and that sending or receiving excess power to different consumer units is not allowed.
2. Prudential Market Monitoring

Result of CP 015/2022, ANEEL REN 1,072 of August 29, 2023, regulated the Prudential Monitoring of the agents within the scope of the Electric Energy Trading Chamber ("CCEE") during the shadow period and amended REN 957 of December 7, 2021.

The improvement were made to ensure greater safety in the operations to identify the leverage of sector agents at levels above the endurable risk levels. According to the decision, a test, called the shadow period, will be carried out, involving the monitoring of the market and the Algebraic Manual of the Prudential Monitoring produced by CCEE. The shadow period, which will initially last 12 months, aims to test the parameters, methodology and limit of leverage of the agents, an essential part of market monitoring.

5) Five-year Strategic Innovation Plan (PEQuI)

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Result of CP 012/2023, the objective of the strategic plan approved by ANEEL is to increase in innovation across the electricity sector by 2028 and determine its priorities. Besides the strategic topics for investment, PEQuI 2024-2028 brought monitoring indicators of the companies' portfolios with related targets and weights, thus influencing the innovation projects to be proposed by energy distributors over the coming years.

Seven strategic topics were defined, which should guide the portfolios of the agents' projects, with new investment opportunities, which are: 1) modernization and fair tariffs; 2) electrification of the economy and energy efficiency; 3) innovations for transmission and distribution and new supporting technologies (artificial intelligence, virtual and augmented reality and blockchain); 4) digitization, standards, interoperability and cybersecurity; 5) low-carbon electricity; 6) energy storage; and 7) hydrogen.

1. Improvement of minimum requirements for connection to transmission and distribution installations

Result of CP 054/2022, ANEEL REN 1,076, of October 3, 2023, amended Attachment III of Normative Resolution 956, of December 7, 2021, which establishes the Procedures for Electricity Distribution in the National Electricity System (PRODIST) - Module 3 - Connection to the Electricity Distribution System, with regard to the technical requirements for connection to the distribution system of consumer units with distributed micro- and mini-generation and power generation plants.

With the amendments, some of the requirements become valid for connection of power generation plants in installations under the responsibility of the distributor at any voltage level, which also resulted in amendments to Module 3 of the Distribution Procedures. Therefore, the rules are now more comprehensive, in line with international standards, and the text is adjusted for better clarity and understanding by the agents.

7) Improvement in ANEEL Regulatory Agenda 2024-2025

For approval of ANEEL regulatory agenda, this year improvements in the direction were approved, which is now focused on Energy Transition and is based on the ESG (environment, social and governance) concept. According to ANEEL, the idea is to advance discussions on the impacts of climate change and implement technological innovations in the sector.

The agenda includes 30 regulatory activities that were divided into four thematic axes to facilitate the executive board's discussions with specialists from the Agency in preparing the standards. The activities for the 2024-2025 cycle were classified in Generation & Market (G&M), Transmission & Distribution (T&D), Tariff and Financial Regulation (RT&RF) and Energy Efficiency & Consumer (EE&C).

8) Electric Energy Trading Rules for 2024

Result of CP 037/2023, ANEEL REN 1,080, of December 5, 2023, amended Appendix III of REN 956, of December 7, 2021, which establishes the Electric Energy Trading Rules applicable to the Accounting and Settlement System (SCL).

In this edition, new and existing energy auction agreements were included, with supply starting in 2024, 2025 and 2026, among other improvements. Other amendments to the current Rules were:

• Adapting the Rules to the definitions of types of orders present in the Network Procedures of the National Electricity System Operator ("ONS");
• Limiting the registration of agreements for sellers classified as Type 2, which will have their contracts limited to 30 average megawatts (MW);
• The reformulation of the allocation of energy from the Free Contracting Environment
  ("ACL") to the Regulated Contracting Environment ("ACR"), which will start following a

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concept similar to the assignment of reserve energy, in which the additional allocation occurs only when it is effectively necessary to avoid a reimbursement. The declaration of the mechanism will be made before the start of the contractual year. The mechanism will be effective starting from 2024, with the declaration of participation still in 2023;

1. • The reformulation of the process to define Proinfa energy quotas, which becomes automated based on monthly load information provided by the agents.
2. Review of Electricity Sale Revenue of Angra 1 and 2 power plants

Result of CP 038/2023, ANEEL Ratification Resolution ("REH") 3,299, of December 12, 2023, established the Fixed Revenue and the Tariff related to the generation of electricity by the Angra 1 and 2 Nuclear Power Generation Plants for 2024.

The periodic review comprises the redefinition of electricity sale revenue of Angra 1 and 2 Power Generation Plants, referring to fixed revenue, such that it is capable of covering efficient operating costs and generating adequate returns on invested capital.

Electricity Sale Revenue of Nuclear Thermoelectric Plants ("UTNs") for 2024 is approximately R$4.7 billion, representing a variation of 2.45% in relation to the current revenue. Among the items that contributed to the increase in Fixed Revenue in relation to the current amount are the cost of fuel (including the value of the adjustment portion) and the regulatory operating cost.

According to Law 12,111, of December 9, 2009, the payment related to the generation of energy of Agra 1 and Angra 2 UTNs should be apportioned among all public distribution service concessionaires, licensees or authorized entities in the National Interconnected System ("SIN"), with its revenue resulting from tariffs calculated and approved annually by ANEEL.

1. Improvement of retail trading from making the requirements for migration to ACL more flexible

Result of CP 028/2023, ANEEL REN 1,081, of December 12, 2023, improved the current framework (RENs 956 of December 7, 2021, 957 of December 7, 2021, 1,000 of December 7, 2021 and 1,011 of March 29, 2022) to adapt it to the more flexible requirements for migration to ACL, determined by the Concession Authority.

To uphold market security, the standard determines that consumers with less than 500 kW load be represented at the CCEE by a retail trader, as per the terms established by Normative Ordinance 50/2022 of the Ministry of Mines and Energy ("MME"). The retailer agent will be the intermediary of the relations between CCEE and the consumers being represented, which includes the exchange of information and control of contracts. For consumers with individual load above 500 kW, being represented by a retail trader is optional.

The standard approved by ANEEL also establishes that CCEE will centralize the information related to migrations of consumers represented by retail traders. The Chamber should structure the Retail Management System that will deal with the registration data management and the flow of CCEE centralized processes, among others. In general terms, the system will enable the exchange of information, with the control of regulatory terms, ensuring that information is accessible and can be the same used by distributors, retailers and CCEE in their billings and accounting records.

ANEEL's Board also determined that CCEE presents within 60 days a proposal for amending the trading rules and procedures, to be debated in a second phase of the Public Consultation.

1. Creation of experimental regulatory environment for temporary tariff sandboxes

The Agency analyzed the projects submitted to the 1st Public Call within the scope of the Research and Development (R&D) program managed by ANEEL to define the necessary regulatory

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withdrawals that will enable testing the tariffs. Authorizing Resolutions were published for each distributor to approve the regulatory withdrawals requested, in accordance with ANEEL REN 966/2021.

Sandbox is an experimental regulatory environment that enables companies to develop innovative business models to test experimental techniques and technologies, with defined conditions, criteria and limits.

1. Review of rural consumers' registration data

Result of CP 042/2023, ANEEL REN 1,082, of December 12, 2023, amended articles 207 and 665 of REN 1,000 of December 7, 2021, which deal with the registration data of consumer units that receive tariff benefits, postponing the deadlines for registration data review of rural class consumer units.

These consumers receive tariff benefits aimed at activities that involve irrigation and aquaculture. The decision amends articles 207 and 665 of REN 1,000, which defines the rights and duties of electricity consumers.

Article 665 of REN 1,000 established the registration data review procedure of rural consumer units, including irrigation and aquaculture, as well as water, sewage and sanitation activities since 2021. After the first cycle, from 2021 to 2023, the registration data review for maintenance of the tariff benefit starts to occur periodically every three years. The first period of registration data review would end in December 2023.

The improvements to the standard are:

• enable the use of self-declaration by the consumer responsible for Group B consumer unit in the second cycle of the registration data review, from 2024 to 2026;
• allow the presentation of self-declaration by the consumer responsible for Group B consumer unit that lost the tariff benefit in the first and second registration data review cycles, without being entitled to a new billing for the period in which they lost the benefit;
• publish again the self-declaration template available in ANEEL REN 901/2020.

ANEEL reiterated that registration data review should be maintained every 3 years to verify whether the discounts received are appropriate as well as the continuity and regularity of the activity developed.

1. Import of electricity from Venezuela classified in the subrogation of CCC benefits

According to its prerogative of technical analysis related to the regulation of electricity tariffs, ANEEL decided to classify the import of electricity from Venezuela in the subrogation of the apportionment benefits of the Fuel Consumption Account ("CCC"). The measure was taken to comply with the decision of the Electricity Sector Monitoring Committee ("CMSE") in its 284th meeting held in October, which formally approved the resumption of electricity imports to serve the isolated system of Roraima, interrupted in 2019. Roraima is the only state in Brazil not connected to SIN.

CMSE was responsible for the decision to resume the electricity imports from Venezuela, as well as the choice of the trade agent, the price of electricity and the amount to be contracted. The import was authorized by the committee for the period from November 2023 to January 2024.

The key changes in sector regulations in the transmission segmentin 2023 are outlined below:

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