Good morning. Good morning, everyone. It is a delight to welcome you all in Curitiba for another Copel Day. I would also like to thank all of you who are joining us online. For a while, it's been one year since the transformation of Copel into a corporation. This was a year of very hard work and a lot of changes. During this morning, you will hear about the consistency of our deliveries and the evolution of our business. Copel, ladies and gentlemen, is living a very auspicious moment, and we have the responsibility of making the company even better, outperform itself, and unlock more and more value.
I hope that all of you who are here on site had an opportunity to go to our expo room and see how modern and innovative Copel is. For those of you joining us online, outside the auditorium, we prepared an environment where we showed the main programs of the companies: smart grids, Paraná Trifásico, remote operation of stations and substations, technology, artificial intelligence, the Copel Corporate Center, automatic reclosers, and that's where most of the capital of the company goes to millions and millions of euros with one single objective: to turn Copel into a benchmark company in the electric segment.
With that, let's go over our presentation, the agenda for today. In addition, with an opening by our Executive Chairman, you will see all of our VPs presenting, and then the heads of the business units telling you a little bit about Copel. In addition, of course, at the very end, we are going to have a Q&A session. For those of you in Curitiba, you will be invited for lunch and then exclusive rooms that will have a lot of time for you to interact with the new Copel team. Here you can see the new nomenclature of VPs in the case of the holding company.
This is in line with the best practices of the private market, but this is also part of an organizational reorganization that Márcia will explain to you in more detail momentarily.
Now, what has made me happiest in the service of Copel is our ability to attract and retain the best talents in the market. You saw the broader reorganization in the C-level of the company, bringing in people who have enough knowledge of the industry. Not just for the C-level, but in some cases for the specific departments of the company. All of that, aiming to have on board a phenomenal team that is here with us this morning. Today will be a unique opportunity for you, shareholders, to get to know a little bit more about them, their role, their mandate, and how they will contribute to Copel's evolution.
When we were in this process of choosing the C-level, Márcia and myself, with the People Board and the Board of Directors , and I'd like to thank Viviane Martins, the People Management Group, and we have Carlos Martins with his daughter, Sofia. Welcome, Sofia. That's what we were looking for: knowledge, complementarity, and experience from other industries outside the electric sector. All of that to put together a top-notch team, as you can see here on the screen. All of these executives have a vast professional experience. They're experts in their areas, and they have in-depth market knowledge.
These are colleagues and partners, partners because most of their compensation, like mine, is linked to the TSR, the performance of our shares. So what do all of them have in common with the more than 4,400 Copelians? The certainty that Copel will be the very best company in the Brazilian electric sector. To start up, I'd like to invite our Executive Chairman, Marcel Martins Malczewski.
Hello, Daniel. I'm never used to this new title, executive chairman. It sounds so sophisticated. Well, good morning, everyone, ladies and gentlemen. It is a pleasure to have this moment with you today. I think this is a unique opportunity for those of you who came from afar for those from Curitiba, and so we can have some quality time. I hope you enjoy this quality time with the top management of the company and the C-level of Copel.
We have here most of the Board of Directors . Practically all board members are here. We have representatives of our committees, including the independent board members. The president of the Fiscal Committee is here too, all the VPs, all the officers. Again, this is a unique opportunity. Take this moment to interact with us. I'll be with you all day long. Most of our colleagues from the board will also be here all day long. So do use this time to talk with us, interact with us. This is one of the reasons why you're here, in addition to learning a little bit more about Copel.
It's been a privilege for me to chair the Board of Directors of Copel on this very important moment of the company. Daniel said the company was privatized a little while ago. It was a difficult, hard, labor-intensive work, but a very successful one as well. You all follow the process. In this Chairman of the Board, my role is to moderate things, facilitate things, keep things on track, both in the meetings of the board and in the management of the company. It's been a privilege working with Daniel and the whole management of the company. We have an excellent group of people who help develop this work at Copel.
And again, my role is to keep the train on track, to keep everyone focused on our core business, on the energy sector, to ensure excellence in execution. I told this to Daniel. Don't accept anything but excellence in execution. Capital allocation is a more and more frequent discussion. In other words, how to balance the correct investments. I'm not going to say good, excellent investments, but the correct, the right investments with dividend payout.
That's something else I always told Daniel. In my past lives, if the company, if the management is lacking ideas and good projects, shareholders will know what to do with their money, so give money back to the shareholders because they'll know what to do with it, but we have looked at the projects carefully. We've been careful not to bite more than we can chew, and you will see we're doing the work of tidying up the house, having the right assets.
Even yesterday, yesterday you had the opportunity of following some announcements regarding the better allocation, better distribution of focus of our managers and of the assets of the company, and something more will be coming soon, so we have a lot of focus now, a lot of focus. Lastly, I'm very happy, just like Daniel, to be participating in this process of renewal of the management and of the headcount of the company. I think that people management is also a very important discipline at this point.
We have to remember that we have this C-level that is totally new for Copel, new in working together, but we have very experienced people. We try to invite the best professionals in their respective areas to join us in this journey. In Márcia, there's an important challenge, which is to be the glue to do one plus one plus one so we can have more than three, creating synergy among all of the players. What I see is that there is a lot of motivation and huge commitment by Daniel and the C-level of the company, as well as all Copelians.
This is perceptible in our meetings when I participate in the projects. Copel moment right now is unique, unprecedented. We have talked with our shareholders and investors. Unfortunately, the country's moment is not the expected one. It's kind of frustrating, but we have to do our own work with discipline, diligence, and take time. Again, thank you very much for joining us today. It is a huge pleasure to welcome you to Curitiba. Every presentation for this Copel Day was prepared and planned very carefully. Daniel putting pressure on everyone for everything to be perfect.
I am sure you're going to have a beautiful day here in Curitiba. Enjoy the event. Thank you very much.
Now, I'll start the first panel. I'll be presenting the strategic panels, and then we'll have the other officers. To start, let's show a video.
[Foreign language] . One of the largest energy integrated groups in the country, present in 10 states, recognized in both Brazil and abroad, record investments and efficiency gains. Now, 100% renewable energy generator. Welcome. We are Copel. Created 70 years ago, Copel has the brand of pioneer approach, technical avant-garde, and accelerated growth since 2023. Copel became a corporation, more agile, more agile to grow, to compete, and more attractive to investors.
From the start, the new model issued renewal for another 30 years of the HPPs of Foz do Areia, Salto Caxias, and Salto Segredo. Together, they account for 64% of all the company's generation. In addition, Foz do Areia and Segredo have space reserved for five new turbines capable of expanding by one-third the total generation capacity to 8.6 GW since 2019. Copel has added more than 500 or 5 million thousand clients, and we have advanced in our concession area.
Today, the fourth largest GDP of the country, Paraná is an economy that is expanding strongly above the national average with a high HDI and a significant increase in our population. Paraná's agribusiness is one of the most productive in the world, growing nonstop for more than 50 years, a huge industrial park and strong infrastructure. So Paraná enjoys a strategic geographic position. It is an energy market that is growing more and more, becoming more and more attractive to respond to such demand, proposed doubling the supply of power in all regions. It is doing the broadest renewal of assets in its history.
It is about to complete the largest modernization program of rural energy in the country, and it is advancing faster with the smart grids, the biggest smart grid program in Brazil. At the same time, it is getting stronger to face climate change. 20 new substations, reinforcement, and intensive training of our crews, the largest drone fleet in the industry, progress in the use of AI that ensures greater speed in reestablishing power after storms. Copel was the first in the free energy market operation in 23 states, so it is one of the leaders in the segment.
It will change the game with the expansion of the market to residential customers. Copel supports its strategy based on four pillars: consistent deliveries, operating excellence, capital allocation discipline, and continued evolution of our organizational culture. In 1994, Copel went public. It was the first in the industry to be in the New York Stock Exchange, and it is in Europe, in the Madrid Stock Exchange. For pioneering good practices, Copel has a solid environmental and social inventory.
Respect to human rights, prevention and fighting unethical behavior since the beginning, a history of sustainability, innovation, respect for shareholders, commitment to society, full focus on clients. Copel, driven towards the future.
[Foreign language] . Every time I watch this video, I get goosebumps. [Foreign language] . This chart shows Copel's trajectory in the last few years. [Foreign language] . When I joined the company in January of 2019, at the start of this journey, and we saw everything we've built over the years, well, this makes me very, very proud. In achieving a CAGR of 48.5%, this is to be on the record, and you know what sets us apart? Throughout these years, it was an impeccable execution of our strategic plan. Impeccable execution of our strategic plan. I'm not saying that we were immune to errors and mistakes.
It doesn't exist. It's not human. But as our chairman said, you know, we are always pursuing excellence, and I would say that we have this relentless pursuit of excellence, and it is one of the marks of this management. Year after year, we committed and we focused on delivering on our promises and in some cases even exceeding them, and now, without the old ties, you can see the pace, the pace of deliveries that we've had. Here we have some of the main ones. Consistency in our deliveries, and what have we been saying to the market?
[Foreign language] . We are excellent business operators and excellent capital allocators. We will be matching growth and dividend payout, always enjoying the best market opportunities. And look at yesterday's example. We announced our IOC for the year and as extraordinary dividends, excluding Compagas and UEGA, in payment in February. And we launched a share buyback program because in our understanding, our shares are underpriced over this country. And this is an opportunity for better capital allocation. It's as simple as that.
In all of these deliveries. In our roadshow a year ago, when we talked with our investors, potential investors, prospects, and current ones, we spoke about our promises. And we delivered on each and every one of them, one by one. I'd like to speak about the most recent one, the one we announced yesterday, the divestment of the small HPPs and the coal thermoelectric power plant of Figueira, in addition to BRL 400 million for that asset, which is quite respectable, to say the least. It fits this part here, portfolio optimization, because we'll be focusing on the large power plants and we'll be relocating our most expert people.
We'll hear more about this. We delivered on a commitment, a targeted strategic pillar, which was the decarbonization of our grid. Today, Copel has 100% of its generation being renewable. Check. [Foreign language] ? And now? [Foreign language] ? We want to tell you a little bit about the company's moment at this moment.
It's important to say that all of these deliveries have made the company more light, agile, profitable, and with an investment thesis which is simpler and simpler and less risky. Copel's thesis is to be simpler and less risky. And here telling you a little bit about our moment. Our Copel day is focused on the second wave. Of course, this is the moment right now. Marcel mentioned this. We have to tidy up the house, extract more value from our assets. The first wave, well, it was called structuring efficiency. All of the deliveries we had. Of course, these waves kind of overlap.
One begins before the previous one ends. But this is the focus of our whole management, the board, the management, and all Copelians. So we are all focused on this second wave, operating excellence. How we can implement, reinforce, and potentialize the culture of ownership.
Marcel will speak about that. How we can increase already 17% that we committed to deliver last year. Felipe will explain. Energy trading, price volatility is bringing a lot of opportunity. Rodolfo is going to explain that. Customer experience. Now the whole team focused on distribution trading. Innovation. Diogo Mac Cord is with us. We want to play a leading role in the regulatory area. André is going to explain that, how we're going to get there. Never losing sight of our vision of governance and migration to North America. Governance and integrity.
You know, you are non-negotiable. After everything is organized with a more mature long-term view, 2026, 2027, 2030, then we'll look at other opportunities, but always privileging organic growth, organic investments, and later on, inorganic. We are here to prepare for the opportunities that may arise. We are not in a hurry. We're not rushed. We want to remain focused on unlocking value, which is our motto here, and to end my part, I would like to say to all of you, ladies and gentlemen, dear friends, investors, shareholders, with such clear strategic view, with such a powerful team, where does Copel want to get?
Well, we want to be a benchmark company in the Brazilian electricity sector around these four pillars, and now we will show you how we'll achieve this vision. Thank you very much. [Foreign language] . I would like to invite our CFO, Felipe Guterres. Obrigado, Daniel.
Thank you, Daniel. Good morning, ladies and gentlemen. It is a huge satisfaction to be here with you, my first Copel day with you, but more than that, I'm really excited because we have an incredible story.
I'll start telling this story to Copel's leadership in value creation in the last five years. I have the TSR of the last five years. I've added all electricity companies which are listed, and we delivered in the period 135% appreciation. 87% came from capital gain, 48% from dividends. But it doesn't stop there. At this point, we are reinforcing our value creation drivers. Of course, as Daniel mentioned, if we want to be a benchmark in value creation in the long run, we have an important journey ahead of us. Our mindset to analyze and to create value uses two lenses: the ROE lens and the TSR lens.
Here plotting the same companies, we are not in the best quadrant yet, but we will get there. I'll tell you how. Our mindset, my approach to ROE depends on profitability, efficiency, and leverage. If we increase profitability, we increase efficiency of our assets. If we work with an optimal capital structure, we increase the compound return on equity. If we increase the compound ROE, we increase earnings per share, and we increase the component of capital gain of the TSR. Likewise, if we increase ROE, we increase cash generation, a better cash flow, and our ability to pay dividends, which feeds another component of the TSR.
TSR means where investors and the company's management are fully aligned. Our long-term compensation for the management of the company has one single indicator: TSR. We are not working on this in the future. No. We are working on this now. I'm going to explain how we are working on profitability. You will remember last year the company announced a target to reduce PMSO of about BRL 460 million-BRL 470 million compared to the LTM of June 2023. I am proud and delighted to say that after a lot of in-house homework, hundreds of initiatives evaluated, and dozens of value drivers captured, we are going to deliver between 100 and 110 additional reductions in this 2023-24 period.
In 2024, we have that with a voluntary dismissal program without sourcing non-strategic functions. We focused a lot on implementing on the implementations for 2025 and 2026. In 2025, we'll review the structure and policies and we'll work on contract aggregation, integrated supply, and we'll reduce and optimize maintenance, services, travel, and vehicle costs. This is the main focus. But since we are in the end of the cycle and we are reviewing the compensation base, most likely we are going to have a write-off of some assets because of the investment, which will partially offset this 2025 gain.
But this will intensify in 2026. And working with an optimal structure, reducing our operating costs, redesigning corporate costs and services, increasing the efficiency of our operating costs, and also moving to the second phase of integrated supply. We are turning the contracts more lean. We are reducing unit costs, and we are gaining efficiency through the consolidation of synergies, intragroup synergies, through large-scale negotiations by category, and the development of Brazilian and international subsidiaries, thus delivering 20% reduction of PMSO by 2026 and not 70, not 20%.
So it's hard work, but we are working on profitability. But it doesn't stop there. If we speak about portfolio efficiency, asset portfolio efficiency, we have two main approaches, and the perspective of divestments that Daniel mentioned, right, Daniel? And we divested Compagas, UEGA, and plans that we announced yesterday in real estate as well, so it's almost 2 billion BRL in divestments, and why?
Well, basically because they were non-strategic assets of low operating returns, and on the other hand, we also announced the investment of 3 billion BRL for 2025, more than 90% of which are investments in distribution and the end of the base review cycle, transmission with reinforcement and improvement, and the increase of availability and efficiency of generation, so 3 billion BRL investments that will bring high returns and current assets that the company holds, but there's something important here as well. The discipline is at the foundation of our management.
And based on that, I'd like to share with you our capital allocation manifesto. The way we look at our capital allocation process in an integrated way. And our process has the company's minimum internal rate of return at the center. And here, of course, that the implicit rate affects the company's IRR, but does not define it, because we understand that there may be short-term distortions and some asymmetric risk views, but it has a strong influence on our IRR, the foundation of our analysis and our processes. But there's five perspectives.
When we allocate capital, we look at strategic cash to maintain liquidity and to face the resilience of our business, contracted investments, but also always preserving the robustness of our balance sheet, which is measured by the level of investment. And as I've been saying, the study of the optimal capital structure is ongoing, and I introduced to you in the first quarter of 2025. Here, we're also looking at tax efficiency and the efficiency of financial results. No new project is evaluated for the company without a clear return that is above the minimum IRR.
But a company as mature as we are, with the capacity to generate cash, must pay sustainable dividends. And that's what we'll continue to do: pay-to-pay-out sustainable, recurring, significant dividends with a payout predictability, but also being diligent in the analysis of the optionalities for capital allocation. What are these optionalities? They have the capacity to generate high value, such as, for example, extraordinary payouts, share buybacks, and M&As.
Speaking of optionalities exercise, today, this is exactly what we have: extraordinary payouts in the amount of BRL 600 million to be paid in December of 2024. It's important for people who are modeling our dividend policy to consider that these BRL 600 million are extraordinary. They are in addition to our dividend payout. Not comparable with the 50% additional that we committed to pay in dividends. Extraordinary dividends will be included in the annual payout discussions that we will close when we close the balance in February of 2025.
The BRL 600 million will be added. In addition, there's the share buyback program. It's a milestone, right? It's the first share buyback program in 70 years. We're very proud of this. But why? Because these are examples of exercising high-value optionalities. That's what we're doing with the efficiency of the assets and capital allocation. Now, moving on from capital allocation to IR, Daniel, we have a full house. Maybe that's another milestone. I don't think we've ever had as many investors with us here. We have 70 investors in attendance. A lot of them also watching us remotely.
So it's a great pleasure, and I'd like to thank you for your presence, your trust, this excellence. The way we have this relationship is something we're taking to a new level. We'll take IR to a global IR position, and we'll do that through three paths. The first, in addition to the consolidation of our local presence, is a global mindset. It is for us to speak the language of international investors, to translate the company to the vision of international investors, because we understand that it is highly strategic to expand our base for long-term international investors who are a global reference, so a global mindset.
We're also going to expand the immersive experiences that you had here when you arrived, because that's where we're able to showcase to all of you the quality, efficiency, and the way we operate. And of course, we're going to use digital to our favor to increase efficiency, speed, and quality of interactions. So this is going to be a combination of really putting our focus on the work and investing in team, technology, presence, exposure, but presence and exposure in a strategic way, with a laser focus on the events we're going to attend, the conferences we're going to attend, and the roadshows that we'll be at internationally.
So having addressed all of these different points and attributes, I'd like to tell you or talk to you about Copel's investment case. And I must say that this is where my enthusiasm goes really high, because it's a simple thesis. Our thesis, our governance increases the management discipline. We have a bold track record of deliveries. We have a solid balance sheet. We have premium assets that are renewed, and we have a lot of value to unleash.
So that's why I believe, and my partners, the management team believe that Copel is the best investment in this sector. Thank you all. Congratulations, Felipe, on this comment of our strategies. And you saw an additional efficiency from 17%-20%. And something that our chairman and the board asks is for us to expand the IR side, investor base, not only the North American and European markets, but also to expand to the Middle East, to Asia. And any of these players may take a long time to get to us, but when they do, they have a long-term position.
And here, all of us have a long-term view: five, 10, 15 years. And to talk a little bit more about this, Diogo Mac Cord.
Obrigado, Daniel. Thank you, Daniel. Good morning, everyone. Those who are present here, those who are watching us online, this is a great joy to be here with you today. I was talking to some people outside. It's the first time that I came to Copel 20 years ago. I had no idea that one day I would be on this stage talking to shareholders and standing next to extraordinary professionals as those that I have by my side today. Before I begin, I'd like to thank you, Daniel, Marcel, the Board of Directors , for the invitation, for the opportunity that you've given me to be part of this new journey at Copel.
Speaking of a new journey, VPAN is part of this. VPAN is a vice presidency that did not exist before, but now it combines three powerful synergistic parts that are strategy, new businesses, and digital transformation. And here, I think Daniel already gave you a spoiler on his presentation, but this is directly connected to those waves that he talked about, where the strategy is reasonably simple. It's for us to look at the short term, ensure operating excellence, seek reference for the operation, and then very calmly and very confidently to move forward to an expansion stage.
And here, when we talk about operating excellence and looking at what we can solve today to improve our efficiency, digital transformation plays a crucial role. And some of new businesses as well, when we look at new products and new services. And when we look and go towards a new stage with a lot of confidence for expansion, new businesses also play an important role. Here we have the three teams working in an integrated way, moving towards the same goal so that we can reach the biggest value generation possible for the company.
Before we speak of the future, Daniel also mentioned, and I'm certain all of you saw the announcement yesterday about the divestments that we've made in 13 small plants: one thermal, one wind, and two small generating centers that have 450 million BRL, that brings us huge focus on the assets that have the highest synergy so that we can gain efficiency in management. You've seen, Felipe also showed this very well. Everything that the efforts that Copel has been making to reorganize its portfolio from decarbonization and the transaction that was announced yesterday, we're able to move further in the simplicity of our thesis and maximization of our returns.
This is a question that really drives me. If we're reorganizing our portfolio to have higher value on the investments already made, what else can I do about it? You saw outside, and I think it's already very clear to everyone what we believe about Foz do Areia. Foz do Areia is a fantastic plant with 1.7 GW of installed capacity, but when it was built, it already left enough space for two additional generating units that bring us huge competitiveness in the capacity reserve auction. What do I mean? I'm talking about using an investment that we've already made.
It's already been made. It's already there. How can we better use an investment we've already made? That's what I'm talking about. The question that we ask ourselves every day is, how many Foz do Areia do we have at Copel? We have a lot of Foz do Areia at Copel. We can extract a lot of value. Another example, our smart metering parks. There's been more than 800 million BRL invested in smart metering parks in Paraná. That already brings us a lot of opportunities: new products, new services that are very common abroad, but that for now here are still unforeseen, and we can extract a lot of value from it.
Copel already has an application for those who live in Paraná who have electronic metering, that our app is a reference in Brazil, where we're able to keep track of how much we've consumed, compare it with the previous month, project the month's consumption, and we'll make a lot of progress on that as well. I'll show you the idea.
We've been able to extract a lot of value on an investment that we've already made. A third example, this is a picture that you'll see every day. It's the use of the electric grid by telecom companies. So what has Copel done? You've also seen outside. We have the spacer. It's a simple idea, affordable, but with that, we're able to organize the use of our network, our grid, by telecom companies. And that combined to the strict inspection, and Copel is the fourth largest distributor in Brazil, and it has the highest revenue in Brazil in the lease of space in our network. This is an investment that's already been made. It's already there. And we were able to get 500 million BRL per year by leasing the space on the poles that are already there. They're already operating. We've already invested.
In the same line of where our next Foz do Areia is, where are the next 500 million BRL? There's a lot of opportunities to maximize investments that have already been made. So if I could simplify in one table what we're thinking about and how we're going to act, what we have here. First, as I said, a new strategic cycle where we put the entire company to think about the two waves that Daniel talked about to extract value so that we can clean house, to be able to expand with a lot of awareness. The new business side, what we're going to do is to start a new market intelligence group so that we can be prepared for this new cycle when the time comes. We're going to make progress here only on those opportunities that make a lot of sense for Copel.
We're only going to advance in those opportunities that make a lot of sense for Copel. But what I can promise you is that when this opportunity arises, we will be ready. The math will be done. The house will be organized. We will have advanced towards operating excellence that you've been hearing about when Daniel said, and Felipe and myself, and you'll hear this when everybody talks to you, because this is a mantra that we've been reciting here at Copel. And in digital transformation, I'll talk a little bit more a little later here. So what are the next steps? In the first half of next year, we'll be seeking the major transformations. We've already selected a few processes, those that are more expensive, that move the point, or that are more relevant to Copel. And for these few processes, we are going to challenge them.
It's not about transforming a process. That's also always been done, like from paper to an online form. This doesn't solve the problem, doesn't bring efficiency. What we're going to seek is to rethink the most important processes for the company so that we can bring the most value. Few processes, but powerful, relevant processes. That's the mission for the first half of next year. After that, we'll move on to the other processes that may not be as powerful, but are equally important in a bigger number, but that are day-to-day processes at Copel. And then in those cases, we'll seek the best experiences, the benchmark. Who does it better? We'll learn from the best. We don't need to reinvent the wheel of everything. And with that, we'll be able to leave behind old bad habits and advance towards excellence.
At the same time, we'll be moving towards this customer journey. I told you that Copel already has an app today where they can keep track of a lot of things with smart metering. But we're preparing a 2.0 version of this app that we call our Super App, where people will be able to have a series of experiences that today simply do not exist. And these experiences are monetizable. We can charge for these new experiences. And here we'll be able to get incredible value. So rethinking customer journey is important. Just to give you a spoiler, today on Copel's current app, we launched a few weeks ago a pop-up. You get there, and the app asks you, "Do you want to receive new products and services by Copel?" It's an opt-in. Our customer has the possibility to say yes or no. I do, I don't.
In very few weeks, do you know how many opt-ins we've received from Copel consumers through the current app? We got 800,000 opt-ins. 800,000 Copel customers have asked to receive in their phones new products and new services by Copel. So look at the size of the opportunity we have. It's huge and transformative. 800,000 Copel customers in very few weeks opt in to receive new products and new services. That's what we're talking about. We then go to the modernization of our big systems, advancing to the best available in technology. We're moving towards cloud, AI, until we get to the modernization of our ERP.
And not to fall into the problem that Daniel addressed, or automating chaos, the new ERP will start in January 2026 with clean processes, efficient, reviewed, so that we can guarantee our new ERP, that everybody knows is not a small investment, will bring the best possible benefits to Copel. And this transformation journey is what we call Copel Beyond, because it goes beyond automation of chaos, as Daniel mentioned. It goes beyond reviewing processes in the short term. It's a journey that has the beginning, a middle, and an end of transformation, and the first step of these major transformations of the few processes. And what do I mean by all of that? A lot of people ask, "So what do you mean?" Maybe this project is a good illustration of what we're thinking about. You've seen this camera outside of this room.
It's a 360-degree camera, similar to those used by Google Street View. This is a project by the distribution company that combined to another project you also saw by G&T that uses satellite images with a precision of up to 15 centimeters. So it's a high-resolution image, 15 centimeters, from the top down to the entire grid, and another extremely high-resolution image from the bottom up that doesn't even have to consider it doesn't have to be in a Copel car driven by a Copel employee. We can place this camera on top of a bus, an Uber car, a garbage truck that goes around the entire city twice a week. And these two technologies combined to an AI platform will allow us that at the click of the button, we'll have a very precise diagnosis of Copel's entire grid. And that meets the three pillars.
We reduce costs, because this is a process that used to be done manually to inspect the entire grid can be done at the touch of a button now. It increases revenue, because it is capable of identifying. You can see here, it already identifies urban vegetation. It identifies electrical grid. It identifies the number of public lighting fixtures that are being used. All of that should be paid. Telecom, as I mentioned, using our poles. So by the click of a button, we'll know who's using our grid, and we'll charge them, and that brings more revenue and higher quality, because this process is free of human error. We can identify a breaking, piece, and everything at the click of a button, so preventive maintenance can be done, and the three pillars, we can do more with less, reducing costs, increasing revenue, and improving deliveries.
So the three big takeaways here, the first is our commitment with responsible profitability. We will plan before acting. You know how I work, how Daniel works. We don't do anything by improvising. We will plan before acting. Two, our vision to maximize the already made investments. There are lots of opportunities for us to work on. And finally, this commitment with the reduction of costs, yes, as Felipe showed, but always conditioned to the improvement of deliveries. It's a condition. It's not cost reduction for the sake of cost reduction. It's cost reduction conditional to excellence in deliveries. And here, Daniel jokes with us often that we're paranoid and only the paranoid survive. You saw outside, how Copel is already an incredible company. It's incredible, but you can be confident that this group of paranoid guys here will only rest when we transform what's already incredible into something extraordinary.
Thank you. Just hold on, hold on, Diogo. We're a little ahead of time. So you said it's been more than 20 years that you stepped at Copel for the first time, helped in Copel's first tariff review way back then. Then you were the external PMO with Daniel here as well. And now you're here as part of our team. But we've been listening to the market. And they say that you're here to buy a Sabesp . So what can you tell me about this? I heard that as well. And I'm curious to know where it came from. I think my contribution with the cleaning has already been done. Those who follow me, I'm fortunate to be friends with you, some of you for a long time. And you know that my trajectory is in the electrical sector.
So my mandate here at Copel is in the electrical segment. The board knows it is, right? It is the electrical sector. As I mentioned, we have a huge journey ahead of us with a lot of opportunities. And there's a lot of studies, in my opinion. My opinion is well known publicly, how much value I see in the electrical sector. What we defend, as Felipe said, is very simple and increasingly simpler and more interesting. Combined to innovation, the electrical sector is excellent. It's rich. And I have a lot of love to basic sanitation, and I wish them all the best. Thank you, Diogo. I made this joke with him, because you know that this discussion is up in the air, right? And I think, as you saw in the manifesto that Felipe mentioned about capital allocation, it's very clear what we believe in.
We believe in the core of electricity generation, transmission, distribution, trading. And we really do believe that we have value in scale and the integration of these businesses. And if you don't see, without giving you a spoiler of Copel Day 2026, I think the work is in our mission, and this is very clear. We'll review the strategic cycle with the board, with the entire company, to map and look at it and see the avenues. And by 2026, Diogo will be here to provide the manifesto of the third wave. With that said, André, please come up. André Gomes.
Your area was one of the restructured ones, so go ahead. Well, after this gossip moment we had, come on, Daniel. Daniel, the saint, Daniel from heaven. Well, you know that I'm a very spontaneous man. I have so many people.
You said that this event was going to be successful, and it is. It is a pleasure to be here with you. My first Copel day, as many of you, except for Bruno at the C level, Felipe, and Rodolfo. Actually, Rodolfo has been with five months with us. So I feel a veteran at Copel. I'm already welcoming new clients. I have two VP roles, so it is a huge pleasure to welcome all of you here, and of course, I will speak a little about my VP and the regulatory leading role that Daniel mentioned in the beginning. After Felipe's presentation, Diogo, then we have the boring regulatory people to say what can be done, cannot be done, but an excellent regulatory department creates value, so look at companies.
If there is a regulatory department that is always going against the current and not creating value, we have a problem. But this does not exist anymore. We can effectively create value. And how do we do that? Here at Copel, we made an administrative decision of having the regulatory department looking at all of the business. So we have an integrated regulatory management. So we have one single voice, a single Copel voice for every team. And this is very, very important. And this integrated view gives us energy generation, distribution, generation, transmission, new product. So it's total synergy with the regulatory department having this leading role. In addition, the regulatory department acts with compliance. Okay, you say regulatory is nice, but what about the things that cannot be done? Well, compliance is about anticipating situations in which we can extract opportunities. Again, anticipating situations to find new opportunities.
It is with this view of compliance that the regulatory department works, and of course, an institutional performance, one single voice of Copel. This makes Daniel's life easier because he has to look at the whole, and we brought to regulatory also market in the market of the company, which includes distribution, generation, trading. What does the market do? The market works in a synergistic way using market intelligence. We've heard this word over and over here, market intelligence, but we are talking here about true market intelligence of the distribution, generation, trading markets, so we bring market intelligence to the company with more predictability, and today, we'll speak more about this. And Rodolfo will also elaborate on this. There is some price volatility and climate change, weather conditions that we've never seen before, so predictability is more and more important for the business, more than ever.
Of course, risk management. This is also something we discussed in the trading company world. So we also work with the risk management for our counterpart. Well, the biggest project for Copel in the two years, the tariff review. So 2026 tariff review being so important, we created a group with all of the departments holding the distribution company support roles so that we can have the best project for 2026. And of course, we use consultants because external expertise is also very important for us in terms of regulation. But what are the main topics? We have to have BRR and zero disallowance. Villela is going to talk about investments. And it's no use having a truckload of investments because what makes sense is it's going to be remunerated. So this is the only target we have to pursue, zero disallowance. Second pillar, regulatory costs.
Here, there is also a trade-off between efficiency and recognition. We have to have regulatory intelligence. This trade-off as well. We have to focus on efficiency and on recognition. Losses and default. We shouldn't change anything if we are winning. Copel performs really well in losses and default. We should not have any surprises. We have to work, anticipate the regulatory movements until we have the tariff review. We won't have any surprises around losses and default. Last but not least, DEC and FEC. That's the moment when we define the trajectory of quality. This is a tariff review moment. This will last five years. This is the moment to focus on quality, DEC and FEC, duration of energy cuts per consumer, and average cuts per consumer per year.
These are the main topics that we work with in terms of tariff review. And also the extension of the distribution contract. In 2015, we had the renewal. So the question is, will we join this new distribution consortium contract? I bring you some highlights of the new contract that is being proposed, that is still being discussed, being evaluated. Some things that we already have in the Copel contract, what we do not have in Copel contract, which is the waiver of legal actions and payment of fines, the change in the regulatory regime, the possibility of the regulatory regime changing. This is also in the new contract. We don't have it in ours. And we believe that the regulation will impact everyone. So annual recognition of investments. If ANEEL will do this, the regulator, if they want to do this, they can.
They choose to do it by cycle, but they can have an annual recognition. This is a methodology that ANEEL can adopt now. Increased network resilience. There is a public consultation open for that, for network resilience. So this is already happening. Anti-competitive behavior. ANEEL is working on that. They are going to hold a public consultation for that. So it's something the regulation will deal with. Many of these themes will be reflected in the new contract, but our regulatory department already has autonomy to approach those topics. Now moving from distribution to generation and transmission, what are the main topics here in GeT? RBSE, Basic Network of the Existing Systems, that impacts all DISCOs. So this has had a final decision. The process was closed, and then it was reopened.
So, here we have to have some fairness because the way that the vote of the ANEEL directors was moving towards is not good for us, so we have to reconstruct the 2028 tariff review process. Well, André, this is too early to talk about. No, no, no, it's not. If we want to have investments recognized in transmission, we have to start working now. Also, zero disallowance for RTP 2028. The transmission company is going to the third tariff review. ANEEL is applying methodologies of distribution and transmission, and more than ever, we have to work on the 2028 RTP or tariff review process starting now in generation. The topic of the moment is curtailment. That's what we have to work with the other generation companies and the regulators. We need some rationality in the operation with a view to economic and financial sustainability.
We have to value power attributes. Diogo spoke about the auction for capacity reserve. This is a theme which is dear to Copel. At Copel, we need more and more to value power attributes. Very well. Now leaving the regulation world and speaking about the energy market, we have this chart. The Copel market is growing more than the South region and more than Brazil. It's a huge market we have here. A big market we have here for Copel. So what is the point here? Distributed generation, DG, is already at a level that is bothering the market and the overcontracting of energy. You probably saw some news from yesterday, an event that happened. I have been speaking about this. Eventually, DISCOs will work as if they were ONS because with this volume of distributed generation, we will need to start operating distributed generation.
Or else, Villela is going to be overworked. This is a theme that we have to follow. Paraná has one of the lowest tariffs of the country. Paraná is one of the first in distributed generation. Distributed generation has become, well, something like, since I'm building a house, I'm going to have solar power in my roof. So it's, you know, this is distributed generation. I mean, I'm talking about this, but it's not. These people are doing things. They are adopting distributed generation. We have the right equipment in Brazil. This is already the reality. This has an impact, and we have to work considering that. This actual situation, this is storytelling that you all know. A lot of subsidies, a lot of centralized generation, and oversupply of energy and curtailment. It's as simple as that. It sounds simple, but it is not.
The effect can be very bad, but this is what we have. And of course, this is causing huge price volatility. Some people have mentioned that. So it's not easy to work on trading because the prices are very volatile. And as a reminder, when we think to our early spot price, we were in a situation where nothing happened. We couldn't really pinpoint when price volatility really began. But we can feel that we are living this. And we have the climate change leading to increase in extreme weather events. This is a reality. This has come to stay. It won't change. And this, of course, gets in the way of how we operate this system. Intermittency of renewable sources and stronger portfolios, which will require a lot more market intelligence. And Copel has an advantage here, and Bertol will show you.
Copel has a very good mix to cope with all this. Bertol and Rodolfo will be speaking about this. In the market, middle office is with us. Why middle office is with market and regulatory? So that we can act autonomously, creating the best models possible, that we can predict steady research, so that we can have a greater integration with our energy trading company. So we do all the work in terms of market intelligence, new lines of research, new modeling, and we get to the integration with the energy trading company. Very well. On my end, my take-home message for you is in terms of the work of the regulatory department of Copel. Number one, revenue maximization. Either through growth or by protecting our revenue, to avoid methodologies and rules that will impact our revenue. Two, political institutional environment. Well, I don't have to speak much about that.
If you work with the institutional part, the regulatory part, you know we live in a very complex environment. We have to be well-positioned with a single voice. We need to be well-positioned. This is what we keep saying to the political and institutional environment. Asset resilience. Well, weather changes, climate change has come to stay. We have to adapt to that and comply with the new climate situation. And energy resources. Optimizing energy resources through market intelligence and risk management. This is a little bit of what I had about regulatory to show you, to say that we are not boring. We are not a boring department. We are a department that maximizes revenue, that plays a leading role. And the takeaway is Copel will be speaking with one single voice in our sector.
We can guarantee and assure you that we are going to have that in regulatory and market as well. There is no company in a regulated sector without a unified, centralized, and strong regulatory department. This is what we did. That's why we brought this to the holding. We are always working in line with what the best integrated companies do. You said that it is all reporting to you hierarchically, but we are also working physically to have this agility that the market needs. To close this first block of our plenary sessions, I would like to invite my dear friend, partner, Márcia Baena, in charge of management and leadership, people management.
Hello everyone. Good morning, ladies and gentlemen. I am Márcia Baena. I'm VP of People and Management.
It is a delight and honor for me to be presenting with you on this very special day for all of us in the year where the company celebrates 70 years of existence. And I want to say that I've been with the company for a little over 70 days. But I assure you that day after day, I only confirm my conviction that I made the right choice of leaving behind my life in São Paulo and after 20 years coming back to Paraná State to deep dive in this project, which I believe will be the most representative in my career along my professional journey. I've been helping businesses have a differentiated performance. And I have done this, helping companies develop the right culture and high-performing team. This is my mandate at Copel as well.
I came to Copel to take over an area which was completely reorganized in terms of scope and focus. As part of that reorganization, my role is to reposition the department so that people and culture will be truly at the core of strategy. And this is what I am going to show you in my presentation about how we are going to be acting. Of course, in this context, we have the priority of my work here at the start and along the whole journey. I'm talking about the culture evolution, the new Copel way. And yes, I'm talking about a culture transformation. What kind of culture are we talking about? We're talking about a culture of ownership, a culture of results, and a culture of meritocracy. I know that this is kind of an ethereal topic.
My role here is to explain my work plan and how we are going to do this at the Copel. We just joined two elements which have proven to be very effective: good people and a strong management model. Why does this bring us the right result? Because when we have a strong management model, that's when we have clarity of where the company wants to be, and we can align the interests of the whole organization. And when we have good people, we kind of know how the results will be delivered. It is the what and how working together. Or to make this more tangible, I'm going to mention the main drivers of this work journey. We'll always start with our strategic guidelines, our ambition, our dream, the triad, vision, mission, and values. We spoke about being a benchmark in the segment, in the industry.
That's our north. In this north, we translate it into clear objectives and targets for the whole organization, for all teams, so that everyone will know how to contribute and what needs to be done. We all know that no results will come at random or by luck. Results require discipline and method, and that's why we have management rituals. With management rituals, we systematize the whole organization. We bring methodology. We bring discipline to the game, and more than anything, a proactive approach so that the results can be achieved. We closed an important management loop. Together with this management loop, we contribute to the well-being of the organization because well-defined targets and management rituals will help the company learn, and once we do that, the results will come.
When we get the results, it is only fair that the team will get a compensation for their contribution to the result. Here we speak about the right incentives. I'm referring to financial as well as non-financial incentives, medium and long term. With this, we give rise to the talent management strategy, which here at Copel will be based on opportunities and meritocracy. Life, glue, and integration for all of these elements. Two elements will be fundamental: leadership and communication as drivers. These two drivers drive forward the new way of working. Now I will tell you about initiatives, projects which are underway already or which will be started in the short term so that you can understand what we are going to do in a tangible way.
But before that, I want to tell you who we are, who our people are, who the Copel is. Speaking about a little over 4,400 employees, of these, 87% are in operations. They're the frontline people making the business happen. I joined the company recently, and I feel I don't need data for that, but the data will show you. I feel that we have a highly specialized technical staff, people who know a lot about the company and the business. Some indicators will show us that. We are talking about people who have been, on average, 26 years with the company. People who have been with us 16 years on average, who are 44 years old on average. 70% have an undergraduate degree, postgraduate degree, including master's and PhD. Recently, we had a volunteer dismissal program .
When we zoom in, we have people who are more senior, 56 years old on average, 26 years in the company, and one third of the audience retired or retired within five years. This is the target audience of this voluntary dismissal program. To tell you a little bit about our initiatives and what will be done in our work roadmap. When we speak about having clear goals and management rituals, a few weeks ago, we started a very structuring project of reviewing our target. This project aims to make the company have targets which are more based on end goals, numerical goals, which have a cause and effect that will allow us to manage meritocracy in a way that is stronger than what the company was able to do.
This project is going to also review the management model because, as a result, we want to have a management model which is ambidextrous, which looks at both the future, thinking about the strategy, but also looking at day-to-day, the short term, the foreseeable future, also considering the midterm. So this is a project, and it will start 2025. All these goals reviewed, and this will be the basis for our short-term incentive program, which I will address in a moment. While speaking about incentives, I said that we speak about financial and non-financial incentives, which I will drill down on the financial incentives because here there is already a significant change happening at the company. The company reviewed the compensation strategy. This review is already implemented for the C-level, and it is underway for the other leaders and the team.
We will complete this work along the first half of 2025. In this review of incentives, we have a significant change, which is a clear signal of where the company wants to get. The company used to have a compensation model which was more conservative, that didn't really encourage that sense of ownership. And it's moving to a skin-in-the-game model. The company used to have 68% of the compensation being fixed, fixed compensation. Now it is down to 32%. 40% will be ILP. And of course, the rest will be this model is very much skin in the game. Even the format of ILP. We are talking about performance share with no safety net, which has only one single KPI. So I'm not talking about a promise of alignment between the management and the investors. We are delivering this alignment of the management and the investors.
Of course, this is a retention program because it has a vesting of three years. Our ICP, which already exists, we are reviewing its architecture so that the short-term incentive will be more meritocratic and will allow us to perceive individual performance. Speaking a little about talent management, I normally say that a good company is a company that grows. Why? Because a company that grows creates opportunities, and in a meritocratic company, the ones with the best performance will grow more, so here I have an excellent combination. I have to remind you, first performance is the what and the how. Copel is really a company that generates opportunities. One of the most unique things when it became a corporation was the fact that we were able to unlock career prospects.
In the last 12, Copel had a thousand career moves, new career expectations for a thousand people, either because of what we call reputations or promotions. It doesn't matter. Thousand career moves, more than 143,000 hours of training by UniCopel showing that we are investing in people. We also have some projects which are ongoing, a project of a new work structure. With this new organizational structure, we'll have new careers at Copel. For example, a Y-shaped career, which does not exist today. In the year, with part of the structures already reviewed to business areas, with corporate area, and this will be complete by the end of the first half of last year, and this will be a game changer because we'll have a lighter structure, less hierarchy, and performance evaluation model.
We cannot speak about this whole transformation if we don't look at the way with which we assess and acknowledge people in terms of behavior and deliveries, and of course, investing in our leaders so that our leaders will be aligned with the new Copel way and inspire the new Copel way. All of these initiatives are organized in a timeline in our project management. Of course, I will not speak about all of them. That's not my goal here today. My target, though, is to make these initiatives happen on a timely basis so we can drive a true change. With that, I end my presentation with my final takeaway. We are speaking about a journey, a cultural transformation journey, and in this journey, we'll have two important elements, and that's what I want to speak about. The first is time.
This is not a journey that will happen overnight, ladies and gentlemen, but we will ensure peace and consistency so that it will happen at the right time. The second element is leadership. I will not be doing this alone. All of the partners that have spoken here today and that will be speaking on this stage today, all of the Copel leaders who are here, and all of you who are here and people joining us online, all of you will be on this journey with me and Daniel. The leaders of the company have to be always one step ahead of this transformation. I would like to say that to me, it's been an honor leading this process side by side with Daniel.
It's an honor to be part of this team because we have the ambition to make Copel a benchmark also in culture and people when the market thinks about a high-performing team. Thank you very much. Excellent. Márcia, please stay with us. As somebody born in Santo Antônio da Platina, the countryside of Paraná State, we are very happy, as you said yourself, to bring you back to Paraná, to be the conductor of this great transformation to make Copel a benchmark. All of the areas, all of the departments of the company have big challenges, but undoubtedly, people in management is a department with the greatest challenges. I spoke about Viviane, the other members, and the whole board. And on behalf of all of us, right, Márcia, we have to acknowledge her because along this process, we've spoken with so many people.
We had this reciprocal choice because you have worked with many, many companies in different industries, and you have this culture of people in management, and you know how important and fundamental it is for us. It's been an honor. Count on me. Thank you very much. Strictly on time, 11:30 A.M., we close the first session as planned. We're going to take 15 minutes for a break, and we'll be very punctual and come back on time. There is a coffee break, but especially for those who are watching us online, we'll be back on time. Thank you very much. We'll move on to the heads of business session with the heads of businesses and Q&A afterwards. Thank you. Bem-vindo todos de volta. Welcome back, everyone. Agora nós vamos para a parte. Here and online.
Now we're going to move on to the heads of the business units, the full subsidiaries, and we'll start with energy trading, and then at the end, we'll have the Q&A session. To open the second session, our older colleague of the new phase, Rodolfo Lima. Você é o mais antigo. You are the one who's been here the longest. They wanted to take it away from you? I think they're still trying, but first, I'd like to make it clear that I was going to start my presentation by making this joke. I thank you for killing my joke. Anyway, all kidding aside, I'm extremely happy and flattered with leading Copel’s trading team. For a few reasons. First, we're at a unique moment of the market with new volatilities, market openings, all of the water and climate stress that André mentioned.
But the second point is the company's momentum. I think we're making it every day. All of my colleagues are showing the extraordinary moment that Copel is experiencing right now. The idea is to talk a little bit about how the trading company is in this context, what we do and how we do it. Copel's trading company is responsible for 100% of the management of energy in the group. We sell 100% of the power generated by the generator, but we also sell third-party energy. We buy energy when required, and we swap when required. About 50% of our energy comes from our generation company, and the other 50% of the energy that we sell is from third parties. An important point here is that 100% of that energy is from renewable sources. Why is that so important?
Because Copel’s trading company works with our customers in the decarbonization journey, either by offering a renewable source or through carbon credits or the renewable energy certificate on the I-REC. So who do we sell this energy to? That's more than 500,000 customers. And I'd like to make a comment here. The accumulated delinquency in the year to date is of 0.2%. I think everyone's been seeing the news and the market, what's been going on. And I think this comes to show how robust our credit governance is in our portfolio. So if I had to choose one word to define the trading company, it would be customer, the focus on the customer. And that's why we separated the customer in two areas. The market's being transformed. What we used a few years ago with one single source doesn't work anymore.
A large corporate customer requires a different treatment than those who are the biggest owner, the owner of the biggest business in the neighborhood, but they don't understand anything of energy. That's why we broke it down. The major client area, we have a trading desk there, and they're there every day in the market, buying and selling energy, providing liquidity, but reading the market and understanding the trends, and that's very important when we sit down with major clients. Most of the time, what our customers ask us is not a conventional flat PPA with a generation. They want some flexibility. There are customers who only consume for certain hours of the day. Others have a planned stoppage, for example, in December. How do we deliver energy to those people?
We use the trading desk, the energy desk to go to the market and buy or rebuy or sell so that we can combine all that and deliver the best walk to the customer. In addition, I have an area that's focused on corporate customers, very technical people that specialize and can sit down and discuss with the trading desks for each of these customers. And we also have an origination department. And these days, the market doesn't live only on the conventional energy. We have swaps and modulation processes and different aspects. And having that with major clients is to foster and turn Copel into a liquidity provider for these new products. The second world is services in retail. That's a whole different story. And in this area, we have a specific area focused on wholesale and retail. And what's the difference from wholesale to major clients?
Wholesale from three, five, 10 MW that don't have a department specialized in energy in retail, where energy management is under Copel's responsibility. So it's a completely different trading. It's a person who does not understand the energy market. Copel comes in and opens the door for them to migrate. There's an important point that I'll mention here. We've been using a lot the strength of Copel's brand for this migration. In addition, we also have customer satisfaction here. This was less important in the industry when the mantra was to buy energy as a commodity, but today it's highly relevant. To achieve customer satisfaction for high consumption, medium, and low as well is relevant. It's essential. The turn of our portfolio today is excellent, precisely due to our customer satisfaction with the service provided by Copel. Then management.
Energy business is not simple, and Copel provides this service to companies who are interested in having Copel representing them with CCEE. So how have we been doing all this? This is some details to simplify and explain our routine and how we have been changing. First, this chart on the right of the blue column, this is the number of times that Copel's trading desk went to the market and negotiated something, and the last quarter was 241 times of bilateral negotiation or whatever. So why is this number important? Because we're there at the counter, being present in the market, talking to the other counterparties, understanding what the market sees is essential to manage our portfolio. It makes no sense to simply work on estimates and projections. We need to know what's happening. The market is liquid.
There are still regulatory issues, volatility issues, and being present there is essential. That's why we spend a lot of time with the trading desk providing all of the support for them to feel able to negotiate at this level, and how important that Diogo mentioned operating excellence. Here, we bring the main platforms that manage our energy trading, and we can say that 100% of the customer journey at Copel and the free market is digital. Of course, that winning over the customer is bilateral. There's no, or it's very rare to see 100% digital sales, but once the lead is generated until they are billed, we can say that we're 100% digitally connected. They come in through Salesforce, a common CRM, goes through our portfolio platform, and ends at SAP. Why is this so important? I think there's two main reasons. First, security and governance.
It's crucial that we have traceability of what's being billed and what's being put. And that certainty that 100% of the bills that we issue have been issued and delivered to the right customer. Second point, highly relevant, is scalability. Everybody here knows about the openness of the free market. So having these integrated platforms with the gears turning is crucial. So the idea is to talk a little bit about the contracting strategy, what we've been doing, and our projections for coming years. And for that, we put together this chart here where the blue line shows our contracting level, and the orange shows how much energy is still available for sale. Start talking about 2025, that's very specific. As you can see, we only have 74 MW of energy to be sold, but only 81% of our contracted energy. Why?
Because we're never going to sell more energy than what is healthy, considering the GSF risk. You're never going to see Copel contracting 100% energy. So we have an estimate of the comfortable, safe level to face hydrology risks, and we'll only go as high as that value. So the 74 MW today is some portfolio adjustment. And where do we see value here? From 26 onwards, our volume of energy is growing. André said it very well. The market is increasingly more volatile, and that's not necessarily bad. We've been seeing more and more good opportunities for the sale of energy. And the idea is with this active desk and the presence in the market, we'll be ready to capture opportunities. And that's what we try to show here.
In this chart, 2026 in orange, 2027 in blue, the rows show, the columns show the volumes traded in each quarter, and the line is the average price, and the main message here is that we sell more than we had sold in the full year in the third quarter at prices that were 20 BRL higher than captured. And that is going to be the dynamics. The market will require that to be in the present, monitoring the market, projecting correctly, but being able to execute as best as possible. And for that, we need to be constantly present. And that's why the trading desk is so relevant. And now, I'd like to talk a little bit about what we consider the cherry on top of our portfolio. What's the idea here?
It's to show the benefits of hydropower generation throughout a typical day in November and how that impacts our portfolio. So here we're looking at November 12th. This happens regularly, sometimes with greater or smaller amplitude, but that's an example. The area in orange is the hydro generation hour by hour. The dotted blue line, what's the average spot price of that day, the PLD price on the average of that day, and then we can imagine a plant that generates 100% flat, a thermal power plant. This would be its revenue on the short term, and the blue dotted line shows me the spot price on an hourly basis. This is what draws our attention, and this is where all our value resides. The orange area matches the blue line. This will always be a reality.
There is no situation where the power price is higher and hydro generation is lower. We call this a big benefit perceived spot price. Simple average, 166. The weighted average weighted by the orange area, 201. Having a hydropower plant benefited us by BRL 34 per megawatt hour. 95% of the shared energy of Copel comes from hydropower plants. These 20% additional revenue are captured by almost 100% of our portfolio. It's very, very important because it shows an effort to increase revenue with a current base of assets and with hydropower, a trading effort, but also regulatory effort to value this source, which is so important for the national electricity or hydroelectricity sector. Yes, I know that this is the crème de la crème. This is no joke. That's what Diogo said.
This could be a new força de guerrilha if we add this on top of the whole portfolio. To speak a little about the retail market, here I would like to highlight two strategic values for us in the retail market. First, there's a very relevant margin in this market. We can see the migration rate increasing every quarter. Today, Copel is one of the largest trading companies in the retail market. But a second point, which I believe is so important and why I see so much value here, is that opening to low voltage should happen in three, four years maximum. And at that moment, we need to be prepared. Copel's strength with the captive customers is very strong. And we believe that the possibility of converting low voltage to the free market. It's a high possibility.
Having the retail market with everything working well is fundamental for us to capture this future opportunity in the market. All right, getting to the end, what is the main mission of Copel's trading company? It is to make the portfolio more profitable. How do I do that? Have to sell energy at the best moment. We managed the example. We work with the middle market team to try to capture that, to anticipate the best timing. That's the first point. Today, power is no longer a commodity. There are a number of attributes, like the one we showed just now, that can add value to the portfolio. It could be a swap among sources, a derivative, an energy derivative, a product that works 24 by 7, 100% renewable sources. The trading company works very much to create and meet this type of new demand.
How do we do that? By using the strength of Copel's brand. We have two big differentials. First, our assets. I know Diogo's sales team. Whenever somebody is in doubt and asks what Copel is all about, you mention this: the wind turbines. This is força de guerrilha. So many trading companies that basically work with securities. But we have physical assets, and they are ballast for our market. Second, the strength of our brand. When we go to the countryside of Paraná or internationally, it is very relevant to say the Copel name. You're seen differently. You have a much greater ability to negotiate, and we have been taking advantage of that more and more. Oh, this is basically what I had.
If I needed to summarize the current moment of the market and the trading companies, that it's going to be more and more volatility, more and more opportunities, and that our team is more robust now to capture these benefits. Thank you very much. Enjoy the rest of the day. The name of the game in trading and our review is to anticipate what's going to happen. We have to be always ahead of the market, and that is why Rodolfo gets a fast track approach, has a fast track with Márcia in People and Management, and a fast track contact with the other areas. Because in our industry, that's one of the things that requires agility more and more, and we need to be more dynamic in the ability to review the structure.
In 2025, we'll definitely have a trading desk in São Paulo and other things that Rodolfo will be doing. Bruno, Copel Generation and Transmission GeT.
Thank you, Daniel. Ladies and gentlemen, good morning. Good morning to those of us joining online. It is a delight and an honor to have one more opportunity to present here Copel's efficiency initiatives at Copel Generation and Transmission. Today, we are a renewed company. The electricity sector is undergoing a transformation, and Copel GeT is prepared to seize the opportunities that arise in this new scenario. Right now, outside, you were able to see a little bit and experience a little bit of Copel's experience. And now, I would like to introduce the efficiency drivers of Copel GeT that will drive the company to a journey of success and excellence. I could not begin without highlighting that our portfolio is 100% renewable.
We are a renewable company. This commitment was taken on with the sale of the Araucária thermal power plant in July and now with the sale of the Figueira thermal power plant. This is a milestone in our history. Currently, our renewable generation portfolio reached an installed capacity of 6.3 GW of installed capacity, 82% coming from hydro, 18% coming from wind generation, 100% renewable. This is very valuable, also given the characteristics of our hydroelectric generation, which is very relevant. Now, I would like to highlight something very important. Where can we get maximum value out of Copel's operations? With the renewal of the three plants, Foz do Areia, Segredo, and Caxias, they account for 64% of our portfolio, and we renewed for more than 30 years.
Considering the strategy, the legal and regulatory assurance with the transformation of Copel into a corporation, which gives the right conditions to sign a new contract to extend these concessions. At the moment that we signed the concession contracts last week, that led to the highest value possible for these concessions and for the company. Thank you. I would also like to highlight the integration of the trading department. It is more and more integrated, and it is responsible for trading the power that we generate in our plants. As you know, and as it has been mentioned before, Copel adopted a voluntary dismissal program. In Copel GeT, 265 employees left the company voluntarily, which represents 23% of our headcount of the 2023 base.
With the sale of the Araucária thermal power plant and the completion of the sale of small hydro plants, SHPs, and also with the mapping of critical positions and specialties, we were able to maintain our technical expertise of our professionals, which was acquired over the years while they executed their operations and maintenance services. And we also maintained our operating safety in our assets. And this was possible with the relocation of these crews, generation crews to our premium plants. We focused on the scale of the mid-size and large-size plants in operation. So there was no discontinuity whatsoever. With the technical expertise, these professionals' knowledge and relocation to these plants, we now have very strategic operational conditions. Speaking about opportunities in the market now and opportunities in the sector as a whole, we have to mention our expectation regarding the issuance of ordinance of the 2025 LRCAP.
Copel is very well positioned and prepared to expand to renewed hydropower plants. This, with all the strategies regarding our suppliers, the implementation schedule, contracts that need to be signed. It's all reorganized, and we're all prepared to bid in this auction. If the ordinance is published today and if we win the auction, tomorrow, Copel can already start putting into practice this opportunity of expanding these two HPPs with a total of 4.2 gigawatt installed capacity, all re-renewed HPPs. What are the alternatives? We have two alternatives for expansion. Alternative one is Foz do Areia plant. With 1,676 of installed capacity, we can install another two generating units of 430 MW for each plant. This means an additional 860 MW of installed capacity.
And the second expansion, it's a bolder, more daring project and more structured as well, with a higher CapEx compared to Foz do Areia. But also with higher capacity, we can implement three generating units, units five, six, and seven, totaling 1,266 MW to the installed capacity of 1,260 MW that the clients currently have. So that's a very important capacity with Copel adding value to the existing concessions. And what makes us a lot more competitive, with a very strong efficiency driver, is that we adopted the marginal cost of the operation for the expansion of the HPP. That increases our operating efficiency by 33%. Considering these two expansions, expansion one and two, all of the technical teams and crews operating these plants now will be able to operate them even after they are expanded. We recently approved our plan to modernize our assets.
This modernization will take place in the short, medium, and long term. Short term up to 10 years or long term for the period of the concessions, for renewed plants 30 years and for SHPs another 20 years of concession. This modernization program has been included in the current and future budgets of the company. We will be able to implement new management models with new technology, expanding the reliability and usability of the plants in compliance with the regulatory parameters required by the regulators and the operator to operate our plants. We have the commitment to make them available for the energy system. I am also very convinced and happy to announce that our efficiency is very much to be highlighted. We have one of the highest availabilities of the transmission system of the Basic Network of the system.
Our grid, we have a very low, the smallest PV divided by RAP variable portions of the transmission sector. In 2023, it was 0.85%; in 2024, 0.71%. This shows our efficiency that is increasing more and more. We are benchmarking the operation and maintenance of transmission. With the expansions, reinforcements, and improvements, in 2023-24, we got authorization from the National Electric Energy Agency of BRL 309 million. For the 2023-2032 period, we expect it to reach BRL 1.7 billion for reinforcements and improvements with previously established RAPs by the regulators. In the deployment of this authorization, we have our PMO, our project office, which in the last two years was among the top PMOs in Brazil. This gives us support to expand these reinforcements. Speaking about renewables, wind and hydro, today, the sector is experiencing a problem of generation restriction imposed by the National Electric System Operator.
Here we have a chart providing physical guarantee of our portfolio. In blue, we have hydro generation. In gray, wind generation from the wind farms based on P90, and in orange, we see how much we had of curtailment or generation restriction until now. That accounted for 58 MW on average compared to our portfolio of assured energy, and the sector needs to solve this structural problem. We are waiting, and we are in touch with the operators to deal with the curtailment of the generation of our renewable plants, which are so much talked about because Brazil is so committed to renewable sources, and this is the resilience of our generation portfolio. We also invest a lot in OEM technology through the Open Innovation Program, Copel Volt.
We identified a number of solutions linked to artificial intelligence, AI, for the monitoring of vegetation under our transmission lines in a predictive fashion so that we won't have any cuts in the transmission line because of the vegetation that can be interfering with the transmission lines. We have geofence the towers, and in the gap, we already know what kind of vegetation can cause failure in our transmission lines. We are all acting preemptively. In the wind farms, we have a performance analysis platform for these wind farms, also using AI. That can predictably anticipate failure so that we can do preventive maintenance to avoid these possible failures. We also use drones with thermal sensors so that we can see along the lines and in the substations if there is any temperature problem that can bring defects.
Technological update of the generation and transmission asset automation system. I'd like to thank you all for your attention and reaffirm once again the commitment of Copel GeT to continue our quest for operating efficiency with innovation and new technologies in our businesses. This is the goal of Copel Generation and Transmission, and we're very enthusiastic about this whole story. To end, looking at the future with hope and with great satisfaction, I would like to close saying that this renewal of the concessions will ensure the 100 years of Copel. Thank you very much. If you allow me, I'd like to publicly recognize you for these innovations. This was a group effort, a team effort, but you were the captain.
I remember well on December 22, Bertol and I were at the door and at the government's door in 2022, December 22, 2022, waiting for the decree to be published and all your work and your relationship, and you can look at last week, we received a transfer of BRL 4.1 billion. We had telecom BRL 2.5 billion, fixed automatic transfer, and now BRL 4 billion, ensuring the 100th anniversary of our Copel. Congratulations, Bertol. [Foreign language] . Let's talk about this. Bom dia a todos, bom dia a todas. Good morning, everyone. What an honor, what a privilege to be here with you today. My career spans 34 years, and in this short time at Copel, slightly over 90 days, I'd like to share with you that I feel proud and passionate.
I've found, on one side, a highly skilled team, passionate about what they do, and on the other, a strong trust relationship and an alignment between the executive directors and the Board of Directors , and this promotes one of Copel's greatest strengths, agile decisions. As a partner, I'm excited with the perspectives and opportunities that we see ahead, with high energy to work on the strategic plan and our cultural transformation program to make it happen. We are the fourth largest distributor in the country, a concession that's been renewed until 2045. We serve 5.2 million customers in 395 municipalities in the State of Paraná . We have a robust infrastructure with more than 200,000 kilometers of grid and 395 substations. This is our state. The State of Paraná today is one of the states with the highest economic growth in the country. In 2024 alone, it's grown more than 8%.
It's a state with a low unemployment level, low default rate, and Paraná is Brazil's third largest agribusiness exporter. This segment corresponds to 20% of our concession energy market. And to face this strong growth, we are investing record levels, historical levels. In 2024 and 2025 alone, as we are about to close the tariff cycle, we will invest approximately BRL 4.6 billion in the expansion, maintenance, modernization, and automation of our electric grids and networks. There will be 19 new substations, 26 expansions, and over 600 km of transmission lines in the entire concession area, Copel's entire concession area, increasing energy availability, increasing the resilience of the grid, improving operating efficiency, and above all, to improve service to our customers. At each tariff cycle, we've been investing, and we are doubling our remuneration base.
This chart here shows that there are many initiatives, and a lot of them you've been able to see outside the expert room, innovation and technology projects, projects that increase the grid's resilience, automation projects, and a very special attention to the digitalization of the computer systems using advanced technologies. The REI project is our biggest innovation and technology project. It's the smart grid project. Believe me, on Sunday, we reached the expressive mark of 1 million intelligent or smart meters installed in more than 100 municipalities in urban and rural areas, anticipating in three months our original timeline. By the end of next year, more than 30% of our customers will have smart meters with an investment of approximately BRL 800 million. So this is the biggest smart grid program in Brazil today, and it is a Brazilian company with headquarters in the State of Paraná .
There are countless benefits with this project: benefits to our customers, reduction in operating costs, and the improvement of system reliability. An example is that we placed a tablet outside so that everyone can see. You can see in real life the benefits to our customers. You can check consumption now. You can go into the app and check your consumption today. You don't have to wait till the end of the month. You can compare consumption today with the average consumption of your neighbors. You can estimate your invoice at the end of the month and set some energy efficiency actions so that you can reduce consumption while the month is unfolding. Another great advantage: cost reduction. We're estimating we'll reduce BRL 16 million in costs this year, with 8 million remote readings, almost 200 cuts, and suspension of power done on distance.
We're saving 4,000 kilometers traveled, preventing the issue of 400 tons of CO2 and directly contributing to our ESG indicators. As for the grid's resilience, we've invested to increase the strength of our asset, our grid, to face climate change and its impacts. In 2020, as pioneers in Brazil, we launched the largest tri-phase network program in Brazil. What was the purpose? Strong energy on the field to increase the strength and robustness of the grid, improve quality, and contribute decisively with the strong growth of our state. By the end of next year, we will invest close to BRL 3 billion, reaching the expressive mark of 25,000 kilometers of three-phase grid, which is a clear proof of our flawless capacity to execute our investment plan. As for the grid automation, over the last six years, we have tripled the park of automatic reclosers in our grid.
Today, there are 24,000 pieces of equipment. The maps, the points on the map, the dots on the map show the amplitude of our program, present at each corner of the State of Paraná , providing utility in the restoring of power, automatic connection. But our main differentiator didn't stop there. With the progress of the technology and the systems, we've implemented the self-healing technology. They prepared a special network for you to see this technology working outside. This technology is revolutionizing our operations and improving our customers' experience. It is capable of identifying a failure, isolating the flaw, the defect, and the reclosers themselves autonomously and smartly can communicate with each other and, within seconds, perform maneuvers without human intervention. So Copel is a reference in self-healing in Brazil. 40% of our feeders have self-healers installed, benefiting 45% of our clients, but we've mostly improved our quality indicators.
Special attention as well to the digitalization of our computer systems with cutting-edge technology. This year, we've implemented ADMS, which is our operation system, the heart of our system. We have a series of processes at Copel, technical and operational processes that are automated, robotic, improving operating efficiency. We've also implemented MDM, that's our system that manages metering. You can imagine how to treat data from 1 million smart meters. We have a system here to assist us and manage all of that. We are also implementing WFM, which is our dynamic dispatch system, a system that dispatches service invoices in an optimized way to the teams who are closer to the point of that demand, reducing transit and costs. We've implemented a system in the REI project to dispatch teams who are replacing meters. Next year, we'll install this for 100% of the intervention teams.
Copel is already today a reference in the service of meeting service bills from our clients. When a client asks a service to Copel, they are served and met within the regulatory deadline, and to reach operating excellence, investment is very important, but it can't be simply investments. We always think about operational logistics. We have teams in 73% of the municipalities in the concession area, a workforce that can reach adverse moments. They can reach 7,000 people on the front line, strategically positioned, closer to defects when they occur, or the failures when they occur, especially the impacts of climate change, and all of us have been following this closely in the world and Brazil, and especially in the south of Brazil, where extreme weather phenomena have been frequent. Over the last two years, we had twice as many storms compared to previous years.
In order to face that, we called our weather forecast partner, Simepar, and through the use of artificial intelligence, we were able to develop a system capable of measuring the impact of storms even before they occur. So that allows us to have an early mobilization of our teams, our resources, so that when the storm comes, we already have people allocated correctly to repair after the self-healing maneuvers. The repairs will be done with fewer customers switched off, with a team that is closer to the area where that failure occurred. An example of that was the storm we had here in Curitiba in September 2024, when wind gusts of 90 kilometers per hour reached the region, and 19% of customers were affected, and within 24 hours, 98% of customers were already restored.
You can see here, on the right, when a major storm occurs, our grids are highly impacted by plants, by the vegetation. With that in mind, also pioneering and leading, we have mapped the vegetation in 100% of Copel's municipalities, all of them. 1,600,000 trees have been mapped and are georeferenced. This allows us, or our teams, to sit down with the cities and build the best preventive plan with ways of trimming and managing vegetation. We don't stop there. We went beyond, and 75% of Copel's grids are in rural areas. In 2019, we sat down with the state government, with the legislators of the state, and approved a bill that clarifies and sets forth the roles and obligations in the management of rural energy.
There's a 30-meter service lane that has been established, which is essential to minimize the impacts of vegetation during storms on the network, as well as reducing demands, reducing the events, reducing interventions, and providing better quality energy to our customers. With robust assertive investments in expansion and maintenance, modernization, and automation of our networks, proper operating logistics, and our leadership in the management of vegetation, even with the major impact of climate change on our grid, we have been maintaining consistently our quality indicators within regulatory standards. Finally, you've had the opportunity to see today. It was a different experience to see everything that I've been talking about, a lot of what I talked about, operating and working outside in the expert room.
That shows you that Copel has a robust strategy that is clear, focused, objective, and the pillars of increasing operational efficiency, improving customer experience, and our DNA of innovation. For 2025, we will continue and maintain the discipline of implementing our investing plan in an assertive and excellent way. The main point of attention, the main focus for us with André here, is the most important moment for the distribution company, which is the tariff review moment. All of our attention, efforts, focus of the entirety of Copel to get the best and greatest tariff review of our history. Thank you. Stay here with us, Villela . We're going to move on to the Q&A session. I'm going to ask the support personnel to please place the chairs up here, please. While they're putting it together, once it's ready, I'll invite all of our colleagues.
But please, Villela , tell us a little bit. So proud of what you're talking about, what we're doing here at this. And you talked about your 34 years of experience in the distribution segment. And when you come here now to join our Copel, you had a very recent difficult experience where you were the head in Rio Grande do Sul when that happened. André was in distribution as well. So if you can tell us the lessons and how the company is going to deal with this new normal of climate change?
Thank you, Daniel. Well, I think that the grid's resilience starts with planning. It starts first with the right pattern of the grid, assertive investments, and something that we learned there was vegetation. The issue of vegetation has to be discussed with the authorities, the public power, about the roles and responsibilities regarding vegetation, as well as the importance of good operational logistics. That's a must. It's very important.
Pre-storm, once the storm happens, it is time for everyone to look in the same direction, to look at society, because together, the public power and the municipal state and federal level, together with the distribution company, working together to minimize such a huge impact to our society. That's it. Thank you. So I'll invite our VPs and general directors as well as please come forward. Take your seats here. Márcia, please come sit next to me. Felipe. And I really make it a point to invite our most recent VP, Yuri, come forward from legal, compliance, governance.
He arrived, without a doubt, is the most recent hire, has been with us for two weeks. He came from a company that's also a reference in this industry. I'm not going to name it, but they have an investor day occurring this week as well and Yuri comes to join this excellent five-star team that we have here at Copel, but he's a global citizen. He has lived in Paris, in Dubai, and he has excellent expertise in the legal side of compliance, ethics, along with our entire team and governance so Yuri, you participate on the Q&A, but if you can, at least greet our audience. It's a great joy to have you with us.
Thank you, Daniel. Good morning, everyone. It's a pleasure to be here with all of you and this wonderful team. This was one of my drivers to accept Daniel's invitation and come to Copel. Basically, in my mandate here, I classify or sort it with three main goals that I have. First is the company's integrity program, together with Vicente, who have been doing incredible work. We need to take Copel to the highest standards of integrity. A company's reputation takes years to build, and it can be destroyed in seconds. So this is extremely important for Copel and for me, personally. So this topic.
The second point, Copel has litigious liability that is large, as is common in distribution companies, and we must manage this in a strategic way, also based on the best methods for the management and positioning, office management, outsourcing, compatible with the market. Finally, the legal team here at Copel needs to absorb this ambitious growth that Daniel and the board have. We've approved BRL 3 billion in CapEx for 2025. And the legal team needs to be a business partner, not the one that says no, but the one that provides support and says, "Look, there's this path.
This one doesn't work. This works." So we need to help Copel reach this ambitious growth that Daniel and the board have in mind. Thank you. And I feel very welcomed here.
Thank you. Please take a seat there. So now we'll start the Q&A session. We are open here, and we're going to have the dynamic starting with the questions that may be asked here in the room for those who are present here. And the team is selecting some of the questions we're getting from the online streaming. So we'll be open. The whole team is here, ready and available to answer any questions that you have.
So, Felipe, without a doubt, your area, our department here started with major announcements with the JCP and the share buyback program. And that's always a question. So how are you going to execute this share buyback program? I know this is still being studied, but if you can share some preliminary information, as we said, it's the first time Copel has a share buyback program. And because we see an opportunity here for capital allocation. So, Daniel, very strategically, we're going to look, obviously, at the market situation, the price of shares to define a strategy along with our governance bodies and investment analysis with the investment committee, the board, not only to assess the right price, but as the capital allocation manifesto puts forth, the internal return rate of these investments and the best mix between preferred and common shares. Carol, please.
[Foreign language] . Good afternoon. This is Ana Carneiro from Safra. I have two questions, Daniel. On your address, you presented those waves, and I thought it was very interesting how you presented them and the company's transformation process. And you mentioned that the second wave, there's still a little bit of cost efficiency. And on Felipe and Diogo's address, it seems that they mentioned contracts and processes. I don't want a guidance, but just a roadmap to try and understand what we could understand as a priority here to meet this line for increased efficiency and whether we have an idea of the magnitude compared to what you've already done. Excellent. So overall, we don't provide a guidance, but in this specific case, since we're talking about a three-year cycle, that was the only exception we had. So last year and this year.
Last year, we had committed and executed 17% of nominal savings for 2023 until the third quarter of 2023. It was BRL 470 million, as you saw on the slide. And this worked to review the ZBB and everything. And Felipe can talk a little bit more about the supply side. Anderson's also here, one of our colleagues who has broad experience, can bring you that. So we're talking about an additional expectation, meaning another BRL 100 million for LTM 2026. We need to remember that all areas, corporate and generation and transmission, either by remanaging teams, investments, and savings in scale, supplies, were implemented immediately. In distribution, it's as we said, there's a sensitivity for the last year of the tariff cycle. So this needs to be looked at, Villela and André and the regulatory team together. So we have this commitment with the view for 2026.
It's under Yuri's scope to review the modeling of all of our contracts. We had models that were adhering to the old model, the legal nature of the company in the past. We had excessive modalities compared to the best practices. What happens in the real world? Suppliers put a price. One side would participate in a bid. Now with the contracts reviewed, the unification of contracts as well from the distributor, there's 170 contracts of third-party services, and that's an optimum point for that. It's certainly not 170, but it's not five or 10. There must be a balance. This is the agenda, as we call, to extract value and unify this integrated operation for us to reach those 20%. Felipe, any additional comment?
No, just to add that the role of integrated supplies is also done in waves. And this phase that starts in 2025 has that view towards the integration and the synergies, the intra-group synergies. Before, in the past, we would have made acquisitions independently as business units, but now we have an integrated eye towards the movements, all purchases. The other is for the categories. It turns us more efficient in taking solutions. There's an important path for us to develop suppliers locally, nationally, internationally. That's also a focus that we have.
But this time is a time for structuring of processes and people that we need to put together, but we're already capturing gains simply by having everybody integrated under Anderson's leadership. And we've already done this project in other companies to integrate successfully, and we're proud of doing so. So while the microphone's going around, can you imagine Copel had three supply departments: a procurement, a G&T, this, and the holding.
And in a prior wave, we had already unified the holding, and it was centralized at the G&T, but you had two major procurement areas with duplicities and so on. And everything is centralized as the best practices define. There's no miracle here. In addition to efficiency and gains in scale, there's also the separation of the functions, compliance, ethics. That's an agenda that is extremely dear to us and very relevant for us at Copel.
Hello, I'm André Sampaio from Santander. I'd like to talk a little bit about the dividend. We saw the extraordinary payout in the share buyback program yesterday. And as you mentioned, the dividends policy is established, and you're working on the definition for the first quarter of what could be a new optimum leverage strategy.
I'd like to confirm if the idea would be after the definition of this leverage, whether the plan is to continue working with extraordinary potentials or to review the dividend policy. Well, I think that after the exercise of the optimal capital structure, we have to look at the dividend payout policy and how to make it more direct, clearer, and more predictable, because today we work with bands and ranges. But of course, in our view, there is a potential improvement to be made. It is possible we'll simplify our dividend policy after we assess the optimal capital structure. But this is an excellent question, actually. The central point is a walk of the talk. Things are not connected. So it's not that we're making all these moves. The current policy already has an important guidance.
We're a mature company, a cash generator, with a level of maturity of the assets. We have to have a payout in our view of at least 50%. And of course, we'll modulate that according to the opportunities that arise. As regards to the optimal capital structure, again, it's what we see in the best practices in the market. It's connected from others, but of course, there are some communicating vessels. But what we see is that a company as large as ours, AAA rated, investment grade for so many years, to have a covenant of 3.5, perhaps that is not the best capital structure. You see, other good private companies are performing differently with more space. Why? Because, of course, there must be a margin, especially when we have so much price volatility.
In the capital structure, we'll see what the target is, what is the range, how much room we have. Again, if about execution and the declaration of dividends are not connected because our current policy already gives us a lot of freedom. Given yesterday's example, the example that we had yesterday, I am Bruno Amorim with Goldman Sachs. Congratulations on the event. I would like you to comment as much as possible, a little bit about the trading strategy. You showed that in Q3, there was a lot of volatility. You benefited from that volatility. And the reason you didn't sell even more was it because there was some liquidity missing, or is there more room for better prices in the future? If you could comment on the trading strategy. Oh, that's an excellent question as well. Well, there was a combination of liquidity, but mainly strategy.
We would have had room to go a little further, but we have seen a new dynamic in the market. Price levels are higher, even when we get a good hydrology as we've had now. So in addition to our analysis, we were expected to sell exactly that amount of energy in Q3 and to save the remaining to enjoy the next good windows. Because what we see is the reservoirs are not full, but there will be new opportunities in the few months coming. But when we combine credit rating, we didn't have a lot of borrowing. And given the future windows that we believe will happen, we understood that it was the moment to hold back some of the sales.
Yes? Good morning. I'm Vladimir Pinto with XP. I saw that one of the waves was moving to Novo Mercado. Can you elaborate on that?
How are you discussing the unification of the classes? That's another thing. That could be linked. It would be an advantage to discuss a Novo Mercado with the revision or the revisiting of the optimal capital structure and to have all of the waivers at a time that we would need for a new covenant limit and for Novo Mercado. As you all know. What is our line of action? Novo Mercado is a goal. We tend to attain it, but it is not just in the hands of our company. There are some elements related to the shareholders, the market situation, country situation, all of that needs to be taken into account. What we are saying regarding that is exactly as Felipe said. We had a deadline until the end of the year to see whether we would get a clearer signaling.
We haven't got that yet, and that's why we'll go ahead focusing on the optimal capital structure for the first quarter of the year, but yes, the wish and the commitment to move to Novo Mercado remain when the right elements of the situation are aligned. We'll go for it. Because Novo Mercado, simplification of having one single class, is very important for us to achieve or buy our objective of global expansion. It's not a mandatory prereq. It will bring us a lot of benefits because we would be at the highest governance level of the country, so unification of classes and liquidity are also a delicate point, and Vladimir, we're sure that this will happen eventually, but we cannot give you the right time. This is the agenda of the chairman, but this is in our agenda.
I'm Daniel Travitzky with Safra. Thank you for taking my question. My question is more sector-related. I want to understand how you imagine the solution for this challenge would be regarding the increase of the challenge for the disco, and how you compare all of the investments you are making, the opportunities that these investments will make to the distribution companies comparing with this aggressive increase of distributed generation. I'll share the answer with André and Villela .
André mentioned that Paraná has the second lowest tariff per capita in Brazil, losing only to Santa Catarina State, and Paraná State has the highest level of DG penetration, second only to Minas Gerais, which comes to show that we are in a concession area which is rich. It has pros and cons, but André, can you elaborate on that, and then Villela , you can explain how this is impacting the operation. Something I've said here, distribution companies eventually will be a mini ONS. There's no way around this. André?
You gave me the hardest question. Come on. DG starts not offering subsidies anymore. I think that subsidies have been given in the past. Contracts were respected. Those who had made the applications were respected. The first point is to seize subsidies. That's clear. The second point regarding what Daniel said is that with this mass DG, these discussions of DSO, whether we're going to operate or not, all of these discussions have to begin now. The biggest trauma of GD was that in 2012, when this was discussed, they minimized the effect that it could cause. If in 2012-2013, we had had a clear public policy regarding subsidies, insertion, recognition, perhaps we would have more rationality.
I mean, no one is against the distributed generation. Distributed generation DG is good. No one is against it. No segment of the sector is against it, but rationalization of the subsidy are way overdue as a discussion of a public policy in our country. Villela?
Well, our grid got to the limit. For many generations, we are already conducting a very complete study about the costs. Oftentimes, we need to reinforce the grid. Sometimes the customer has to pay a part of the investment, and now we got to micro DG, which most likely in some regions will have a distribution cost, but also a cost for the customer, so it's possible to have to rethink. The customers will have to rethink if they're connecting, whether it's worthwhile or not, and to sum up, even with this whole environment situation, we saw how the market grew this year.
More than 8% this year. Discounting DG, 6%. Of course, heat had a big impact this year. But even with this kind of growth, our market is rather resilient. Did that enough? Our market grows because of our businesses. The GDP of the state grew twice as much as the Brazilian GDP. But we cannot minimize the fact that Brazil is not for amateurs. The bill of the offshore wind farms will have an impact. We have a very critical view of that. We are working together with the entities and the associations involved for this not to go forward. There's a question we received here. There's no name, but it asks, what are the business segments that are priorities thinking about the expansion? I'll turn to you, Diogo, but I think it's clear here that this is a third wave.
We are on our second wave, so 2024, 2025, and part of 2026. So it's very clear in the extraction of value we already have today. So being repetitive and saying this again to make sure it's clear what our vision is, what our mindset is. And the second question, or the second aspect, is that it is the electrical sector, generation, transmission, distribution, and trading of energy. If there are opportunities that might make sense, they are the lines on the field, what we see, and why are we saying this repeatedly and believe greatly in this thesis of our core business? Because first, otherwise, we would not have sold Compagas. It wouldn't make sense to indicate towards left and turn right. And the second point is our belief that the sector is going to grow greatly. Someone asked about data centers. We have electromobility.
There's countless projects of green hydrogen. If a fist of that that's already being discussed comes through, there's already significant increases here. So within those four electrical power segments, in our view, an expansion here for 10 years, how many concessions couldn't have the renewal capacity that we have in Foz do Areia, Caxias, and Segredo? With having that view of 2030, 2035, what's going to happen? How it's going to be addressed? Time will tell, but for us here, I'm very vocal about this. Core business, scale, expertise, know-how are great competitive advantages for a Brazilian company. Diogo, I think. I get excited about this because, yeah, that's exactly what I was going to say. Now, I get excited. Here's the thing. You've heard me on calls, and there's no company that generates long-term value simply by cutting costs and selling assets.
At some point, we're going to look at that at the right time. We're not in a rush. It's a long-term vision. Ana Letícia talked about the 100th year of Copel. So that's partially guaranteed with that. So we have to have a very clear vision. Eu tenho que ler pouquinho mais, John. Execution in this line, and that's what we believe in. That's clear. About the transmission and generation segment, we have great expectations of winning the capacity reserve auction. We're going to double the installed capacity of the three renewed plants, Foz do Areia, with a capacity to almost 860 MW, half of the plant. In Segredo, it's more than half. three machines and 422,266. So the expectation for expansion and short-term generation is materialized with those possibilities.
In reinforcement and improvements that were presented here today, almost BRL 1.4 billion for the next 10 years in reinforcement and improvement. So, as you said, afterwards, the company's strategy is, but just to add again, I'm sorry, go on. Oh, it's important to mention as well that this growth, when it comes, it is not based on an idea of increasing one gigawatt or so many kilometers. Why are we looking at the capacity reserve auction? Because we believe that it's a good opportunity with good margins. So what's the segment we're going to go in? The one that brings the best results to the company, the one that makes sense, the one that checks all the boxes that we're going to start to outline. That's why we need some time to plan. So the movement is going to be whatever brings value to the company. So that's important.
It wouldn't be reasonable for us to select, "Oh, I want to go this way or that way. I want to create value to the company." I think that this construction, this group here can see value maybe in some opportunities that maybe other players don't generate. We need to show that there is value in opportunities in assets that are there. Just to make it clear, we'll go into whatever brings more value to the company. It seems simple, but that's the message. We don't have any type of preference for a segment or another. We study and do whatever makes sense strategic for the company. Just to conclude, there's a lot of environment, an environment of a lot of uncertainty. This thing about the curtailment is something that's here to stay. Nobody knows the size, the proportion.
So these environments have a lot of uncertainty, and this having a more conservative posture, considering all of the agenda that we talked about, what we have ahead, time will be our ally in this construction, this development, until things get a little bit clearer. Another one here on the screen. Let's have a look. We cannot see it yet. Okay. No? It had already been answered. As a complementary way, okay. We have a few final minutes. Do you have another question or two? We have another one there. We'll still have time for one or two final questions for us to close and continue with our program for the afternoon. So while we're waiting, Márcia, people in management, anything you think is important?
I think your term now on the first slide, I mean, how is it to deal with this huge group of people that are highly qualified and committed that we have here at Copel? So in addition to, obviously, what was already shown, I have no doubt that in this journey, it's always important to highlight the cohesion of this group who's sitting here. This group present here, as was said in the beginning, Marcel mentioned, and you as well, is what's going to set the tone for this change and this transformation. So everyone, the people here, will be paying attention to everything that we say, that we reinforce, and how we're going to behave. So we here will be the first to act and set the tone for this company that's seeking excellence, that is concerned with delivering, but how we're delivering.
We know we have a long-term journey ahead. This relationship is with the business and the people, so that people choose to be with us for this long-term relationship and growth for us as well. Always to reinforce the strength of this group, the importance of this group who's here with you today. The question came up here, what's the main challenge that the company sees for the coming years? I'll leave this for my closing remarks because it is my closing remarks. I'll open again if anyone has a question. I think I'd like to stress, I think maybe there's a question, but I'd like to stress that this cohesion that comes not only on the executive level, the C-level, the selection, or this All-Star team, but also together with the company's highest governance body, that's the Board of Directors.
We already talked about it, and we have in here Viviane, Marco is the coordinator, the investor committee, Pedro Sales, our board member, Marcelo Geraldo. There's a couple who were not able to attend, but we're seeing massive presence of them here, and there's alignment, each one with their scope, within their scope, within their roles, and their jurisdiction. The board knows how to do this very well on the side of requiring and calling us on it and providing strategic alignment. The legal nature of Copel, it's just Villela talking and other people, it's to have the ability to react quickly and make quick decisions and to be able to have this conversation to face all of the challenges in this sector.
So already getting into the final session, all of the virtues that Copel has, in our view, this aspect of being a corporation, of not having a set controller, is seeing the possibility here, the quality of our board, the quality of our team, and how this unfolds and cascades down to all of the teams. And whenever always seeking balance between people who may come from outside, and the vast majority of people who are here and contribute to the company stands out. So I see that as a huge competitive edge. There are challenges, yes, but here in the essence, it brings great competitive edge, as well as in the nature of those 10%. For me, for us, this is extremely relevant because it will ensure that Copel remains as a corporation when it turns 100 in 20-30 years.
While also maintaining the major shareholders, the State of Paraná and BNDES that's also being represented here, thank you for attending, participating in this growth and value generation so we can bring everyone together, everyone in its role, everyone being able to combine this development, growth, expansion. Answering the question, what is the biggest challenge? It's execution. It's execution. A powerful team, excellent board, excellent committees, they're spectacular, great teams, the right vision, clear vision of the waves. We know where we're headed. We know what we need to do. We need to take care of the execution so that we continue with the track record that we're maintaining and ensuring that our shares gain value. I thank you all very much, everyone who's participating, who's attending. We're going to conclude the online stream.
We have a few housekeeping messages here of how things are going to be here in person, but I thank you very much. This is, as we said before, the biggest attendance in person and on video in Copel's history, and that only proves how Copel is being watched and invested. If you think about everyone as buying, and we need to be responsible to deliver and meet all of the expectations we see in our market and more than 420,000 shareholders. Thank you all very much.