CFE FIBRA E

23rd Santander Latin American Conference

Cancún, Quintana Roo, México | 15-18 January 2019
 DISCLAIMER

IMPORTANT: You must read the following before continuing. This presentation has been prepared by CFECapital, S. de R.L. de C.V.
(“CFECapital” or the “Manager”) and is being provided to you for informational purposes only.

Neither the Manager nor any of its affiliates or representatives makes any representation or warranty, express or implied, as to the
accuracy or completeness of the information contained herein or in any other written or oral communication transmitted or made available
to any recipient, and nothing shall be relied upon as a promise or representation as to the performance of any investment or otherwise.
The Manager and its affiliates and representatives expressly disclaim any and all liability based, in whole or in part, on such information,
errors therein or omissions therefrom. This presentation does not constitute an offer to sell or a solicitation of an offer to buy any securities
and may not be used or relied upon in evaluating the merits of any investment. The information in this presentation is current only as of the
date hereof. For any time after the date hereof, the information, including information concerning the CFE Fibra E’s business, financial
condition, results of operations and prospects may have changed. The delivery of this presentation shall not, under any circumstances,
create any implication that there have been no changes in the Company’s affairs after the date hereof.

This presentation contains forward-looking statements. All statements other than statements of historical fact included in the presentation
are forward-looking statements. Forward- looking statements give the CFE Fibra E’s current expectations and projections relating to its
financial condition, results of operations, plans, objectives, future performance and business. These statements may include, without
limitation, any statements preceded by, followed by or including words such as “target,” “believe,” “expect,” “aim,” “intend,” “may,”
“anticipate,” “assume,” “budget,” “continue,” “estimate,” “future,” “objective,” “outlook,” “plan,” “potential,” “predict,” “project,” “will,” “can
have,” “likely,” “should,” “would,” “could” and other words and terms of similar meaning or the negative thereof. Such forward-looking
statements involve known and unknown risks, uncertainties and other important factors beyond the CFE Fibra E’s control that could cause
the CFE Fibra E’s actual results, performance or achievements to be materially different from the expected results, performance or
achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous
assumptions regarding the CFE Fibra E’s present and future business strategies and the environment in which it will operate in the future.

The presentation is confidential and may not be reproduced, redistributed, published or passed on to any other person, directly or
indirectly, in whole or in part, for any purpose. This document may not be removed from the premises. If this document has been received
in error it must be returned immediately to the Manager.
Agenda

1 Mexican power sector

2 CFE at a glance

3 CFE Transmisión

4 FCFE results and prospective

3
Agenda

1 Mexican power sector

2 CFE at a glance

3 CFE Transmisión

4 FCFE results and prospective

4
Generation and commercialization are open to competition while
transmission and distribution operations remain exclusive for CFE.1

Commercialization

Bilateral Agreements Qualified suppliers

& traders*
Generation Wholesale Electricity Market End-users

Last resource Qualified users

Generation suppliers*
Spot market (>1MW)
subsidiaries

Basic users
Basic suppliers2*
Private generators Auctions (<1MW)

Transmission3 Distribution3
* Private & CFE
affiliates/subsidiaries

Transmission Distribution
subsidiary subsidiary

Source: (Content in Spanish) - DOF, Law of the Electric Power Industry. DOF, Wholesale Electricity Market Rules.
Note: 1Although private investment is allowed through partnerships, joint ventures or bilateral agreements. CFE-owned and Independent
Power Producers (IPPs, which include self-supply and co-generation figures, among others) were assigned to a new subsidiary (Genco V)
and are allowed to sign electricity coverage contracts with the Basic Supplier Subsidiary. Non-CFE Power Purchase Agreements (PPAs)
can remain as Legacy Contracts or migrate to the new framework. 2Currently, CFE is the only Basic Supplier, although CRE has granted 5
permits to three new competitors. 3Rates are defined by the CRE.
 Three categories of market participants exist: generators, suppliers and
end-users, which have very different attributes amongst them.

Suppliers • Registered users with big load

centers (>1MW)4.
Qualified suppliers • Can participate directly at the
• Participates at the MEM1 MEM, through bilateral
supplying Qualified Users (with contracts or through a
which it has a contract). Qualified Supplier.
Qualified suppliers
Non-supplier traders & traders
Generators
• Can conduct transactions without
representing physical assets.

Last resource

End-users
Generation • Provide service temporarily when Qualified users
Qualified suppliers fails to do so. suppliers (>1MW)
subsidiaries

Basic users
Basic suppliers
Private generators (<1MW)

Generator (≥0.5 MW) • Supply electric service to users that don’t • Non-qualified and non-
• Represents one or more power plants in the MEM.2 participate at the MEM. registered users (<1MW).
• Participates at the MEM or through bilateral contracts. • Don’t participate in the spot market. • Can’t participate at the MEM.
• Sell electricity at regulated prices. • Buy electricity from Basic
Exempt generator (<0.5MW) • Required to provide universal service.3 suppliers at regulated price.
• Can only sell their products to a Basic Supplier.
• Can participate in the MEM only through a Qualified Supplier.

Source: (Content in Spanish) - DOF, Law of the Electric Power Industry. DOF, Wholesale Electricity Market Rules.
Note: 1Wholesale Electricity Market by its acronym in Spanish Mercado Eléctrico Mayorista. 2The Intermediation Generator represents those
legacy power plants and load centers included in legacy contracts. 3For this purpose, they can access the Universal Electric Service Fund
(FSUE). 4Also, legacy contracts’ load centers.
6
Agenda

1 Mexican power sector

2 CFE at a glance

3 CFE Transmisión

4 FCFE results and prospective

7
80 Years Federal
Comisión Fulfilling Mexico’s Electricity
de Electricidad (CFE): moreNeeds
tan 80 years of history.

1937 Population in Mexico with electricity Installed capacity

38.0% 64 kW

Generation Transmission and distribution Clients

In 1942:
1 plant Without its own network ~105,000

3Q18 Population in Mexico with electricity Installed capacity

98.7% 55,240 MW

Generation Transmission and distribution Clients

187 Plants Transmission grid: 107,709 Km

(CFE: 157, IPP1: 30) Distribution networks: 837,640 Km
43.1 million

Source: CFE. 1 Independent Power Producers.

8
Company snapshot: 14 subsidiaries and affiliates plus specific business
units.

Holding

Generation Transmission Distribution Commercialization Other

Generation Transmission Distribution Basic Qualified Fuel Trade Legacy Contracts

Nuclear
companies (16 Business Units) Supplier Supplier3 (CFEnergia) (CFE ICL)
Generation
(CFE Genco I-VI)2

Business Unit Subsidiary Affiliate

Affiliates: Governed by 5-member Board of Directors or by an unique administrator. CFECapital governing

bodies are its Technical Committee and General Assembly. Fuel Trade Financial Services
Subsidiaries: Governed by a 5 or 7-member Board of Directors (CFE Corp, SENER, SHCP and independents). (CFE Internacional) (CFECapital)

• CFE ICL: manages contracts created under the former regulation and represents these power plants at the MEM.
• CFEnergía and CFE Internacional: national and international energy traders in charge of supplying CFE Gencos (and third parties) of fuel at
competitive prices.4
• CFECapital: creates value for CFE through the promotion of investments on energy infrastructure, currently manages the first vehicle to
monetize the cash flows generated by the energy transmission assets of CFE (CFE Fibra E).

Source: (Content in Spanish) - DOF, Law of the Federal Electricity Commission. DOF, Terms for the strict legal separation of the Federal
Electricity Commission. CFE, Annual Report 2017.
Note: 1Partnerships, joint ventures or bilateral agreements are allowed to carry out the operation, maintenance and expansion of
infrastructure. 2Genco V Subsidiary covers all CFE’s IPPs contracts through external legacy power plants. 3Qualified Supplier also operates
as energy trader and last resource supplier. 4Natural gas, LNG, fuel oil, diesel and coal. 9
CFE is looking forward to regain its position as a relevant global player
in the energy sector.

On December 8, key objectives for the National Electricity Program were presented by the new CFE
leadership and the Federal Government. The program aims to achieve, among others, the next
objectives:

Improve audit and accountability processes and

increase anti-corruption measures.

Boost the generation capacity.

Increase investment.

Promote clean energy sources.

Offer competitive prices for the end-user.

Source: Presentation of the National Electricity Program. Media available here.

10
 Mexico’s power sector will need strategic investments through the entire
value chain.

Investment requirements 2018-2032 Gross energy consumption forecast by scenario

(billion USD) (Consumption in GWh)
AAGR1
Transmission 550,000
3.5%
USD $9 billion 500,000
9% 3.1%
Generation
450,000 2.5%
USD $86 billion
84% 400,000
Distribution
USD $7 billion 350,000
7% 300,000

2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Low Planned High

• Additionally, the Law of Climate Change establishes a 35% goal of clean energy generation in the country’s energy
matrix by 2024.

• Suppliers, qualified users and owners of interconnection contracts are bound to consume certain percentage of their demand
in clean energy sources.2

• To be able to achieve it, a market for Clean Energy Certificates (CELs) was created.3

Source: (Content in Spanish) - SENER, National Electric System Development Program. DOF, General Law of Climate Change. DOF, Law
of the Electric Power Industry .
Note: 1Average Annual Growth Rate. 2SENER established a 5% CEL requirement for 2018; 5.8% for 2019; 7.4% for 2020; 10.9% for 2021;
and 13.9% for 2022. 3One CEL is equivalent to 1 MWh of clean energy generated. FX MXN 19.49 per USD, 01/07/19 (Official Gazette).
11
 CFE is planning to invest USD $16.6 billion in the next 5 years.

Process Notable projects

2018-2022 CFE planned investments by business
(billion USD)
$7.6 • Norte III, Cd. Juárez (CC 907 MW).
• Topolobampo II, Ahome (CC 887 MW).
Generation • Chicoasén II, Chicoasén (HEP 240 MW).

$5
• SIN-BC Interconnection.
2.2 $3.6 • HVDC Ixtepec-Yautepec.
• Wholesale Electricity Market (MEM).
Transmission Measurement Systems.

2.8
$0.4 • Acquisition of connections and meters.
• Measurement scaling.
Transmission Distribution Generation Other businesses
Distribution • Remote operation and automation.

• Commercial Model Transformation

• USD $2.8 billion for the Transmission sector are Program (Basic Supplier).
expected to come from CFE Fibra E.
• Intelligent meters (Basic Supplier).
Other • Telecommunications infrastructure and
assets market and lease (CFE
businesses1
Telecom).

Source: CFE, Business Plan 2018-2022 main elements.

Note: Other businesses: Qualified Supply affiliate, CFE International affiliate, CFE Energy affiliate, CFE Telecom Business Unit, Engineering
and Infrastructure Projects Corporate Office (DCIPI) and the Equipment and Materials Tests Laboratory (LAPEM). FX MXN 19.49 per USD,
01/07/19 (Official Gazette).
12
Agenda

1 Mexican power sector

2 CFE at a glance

3 CFE Transmisión

4 FCFE results and prospective

13
 CFE Transmisión has proven industry experience and is a business with
stable cash flows driven by a regulated tariff.

CFE Transmisión infrastructure (end-2017)

Concept Unit Total

Transmission lines2 Km-c 107,709
Financial objectives Substations3 No. 507

• Generate value and profits for CFE and Transformation capacity MVA 158,035
the Federal Government. Optical fiber capacity Km 43,803
• Celebrate contracts with the private
Employees No. 8,335
sector/affiliates to finance infrastructure.1

The National Transmission Network (RNT) has three independent systems:

Client-focused objectives 1. The Baja California (BC) System is interconnected with the Western Electric
• Grant open access under non- Coordinating Council.4
2. The Baja California Sur (BCS) System is subdivided among two isolated systems.5
discriminatory conditions.
3. The National Interconnected System (SIN) includes the rest of the country.
• Share energy measurements with
suppliers.

Operation objectives
• Fulfill service requirements on quality,
reliability, continuance, and security.
• Expand and modernize the RNT as
instructed by the Energy Ministry.

Source: (Content in Spanish) - Organic Statutes of CFE Transmisión. CFE Transmisión, Business Plan 2018 – 2022. SENER, International
Public Tender SENER-01-2018. Mexico Projects, 0689 CFE: SIN-BCS Interconnection Transmission Line. Note: 1Installation, maintenance,
management, operation and expansion (Build-Lease-Transfer or Build-Operate-Transfer). 2Includes 46,789 sub-transmission lines
previously handled by Distribution. 3Additionally, 1,615 substations previously handled by Distribution and 133 by Generation will be added.
4A tender was held in 2018 to interconnect the BC System to the SIN (HVDC 1,400 km-c, 500 kV and 1,500 MW capacity). 5A tender will be 14
held in 2019 to interconnect the BCS System to the SIN.
The company is planning to invest around USD $5 billion during the next
five years in 77 expansion and/or modernization projects.

Most of the projects are instructed by the And they are focused in overcome key
Ministry of Energy (SENER) challenges in the power transmission sector

Own (8)
1. Expansion
11%
• Transport energy from windfarms in the Northeast and
Southeast regions.

Legacy (39) • Deal with incremental demand in the Northwest, North,

17% Northeast, Center, West, Baja California and Peninsular
regions.

SENER (30) 2. Modernization

72%
• All 77 projects are financed either partially1 or totally
public budget2. Additionally, SENER projects have
access to other financing mechanisms such as Fibra E3,
CAT4, and other CFE funds.
• Reduce maintenance costs and avoid failures in
service through equipment replacement, protections,
insulation and infrastructure improvement. Represents
approximately 60% of investment.
• Other investments: optical fiber and information and
Communications Technology (ICT).

Source: CFE Transmisión, Business Plan 2018 – 2022.

Note: 1Public Financed Projects (OPF). 2Public Budget Projects (OPP). 3Investment vehicle for public/private companies that monetizes
cash flows of infrastructure assets. They’re operated through a trust that issues stock certificates, which are publicly traded in the Mexican
Stock Exchange (BMV). 4Construction, Lease and Transfer.
15
Amongst the most important objectives of the power transmission
projects is to reduce congestion costs.

National electric system transmission corridors, 2017 • 50% of these connections automatically
625 disconnect blocks of generation or of
520
31
loads to preserve the system’s reliability.
1,063
900
• Nevertheless, as more transmission corridors
447
108 400 600 become saturated, the risks to maintain the
665 185 570 system’s stability are greater.
630 517 46
37 500
687 23 827 1,022 • Transmission saturation will lead to increases in
630 750 950 wholesale electricity market prices, restrictions to
51 607 44 22
764 interconnect new load centers, affect power
600
3 650 1,556 supply and risk the SEN’s stability and
87 1,500 reliability.
1,238 25 1,815
1,260 1,700
633 0 24
1,360 600 1,526
1,350 16 1,500
2 4
763
685 1,749 838
106 1,750 825
1,248 / 1,200
0 1,216 5
1,145 / 1,145 3,751
40,1 1,426 1,095
3,640
1,280 2,228 476
5
23 1,900
Maximum flow (MW) 201
2,560
Transmission limit (MW) 2,500 315 1,404
295 1,578
Hours > Limit (hrs) 9
41
1,109 1,400
1,763 204

Source: (Content in Spanish) - CENACE, Whole Sale Electricity Market’s National Transmission Network and General Distribution Networks
Expansion Program 2018-2032.

16
During 2017, congestion costs were higher than MXN 6.6 billion.1

Congestion costs per congested line

(Thousand MXN per MW hour)
4. Nacozari (Sonora) – Nuevo Casas
Grandes (Chihuahua):
503 MXN 1. Monterrey – Saltillo:
4 6. Norte – Noroeste:
1,031 MXN
433 MXN
7. Champayán (Tamaulipas) –
6 Altamira: 105 MXN
8. Manlio Fabio – Altamirano
3 (Veracruz): 84 MXN
1
3. Hermosillo – SIN:
588 MXN
5
7 5. Ticul (Yucatán) –
8 Dzitnup (Yucatán):
447 MXN
10
9 2
2. SIN – Escárcega (Campeche):
10. Teotihuacan – 857 MXN
Texcoco: 56 MXN
2. Malpaso dos (Chiapas)
– Tabasco: 70 MXN

Source: 1Annual Report of MEM 2017 (content in Spanish).

https://www.cenace.gob.mx/Docs/MercadoOperacion/ReporteAnual/2017/Reporte%20Anual%20del%20MEM%202017%20-
%20Monitor%20Independiente%20del%20Mercado.pdf Calculations made by CFECapital based on Graph 36 (page 102).

17
Furthermore, according to CENACE,1 congestion costs are increasing
yearly if no investments are made.
Congestion costs in the RNT2 without reinforcements
(Million USD)3
900 828
800
700
600
500 708
400
297
300
200 186
100 251 197
170 143 158 120
111
0
2018 2019 2020 2021 2022 2023 2024
4 5
Supply + O&M ENS

USD $2,004 million USD $978 million USD $1,065 million

Accumulated costs Accumulated costs Accumulated
without reinforcements with reinforcements benefits from savings

Notes: 1CENACE: National Center for Energy Control, 2RNT: National Transmission Grid,. 3Present Value of 2017, 4O&M: Operation
and Maintenance, 5ENS: Energy Not Supplied.
Source: CENACE page 465,466 (content in Spanish)
https://www.cenace.gob.mx/Docs/Planeacion/ProgramaRNT/Programa%20de%20Ampliaci%C3%B3n%20y%20Modernizaci%C3%B3n
%20de%20la%20RNT%20y%20RGD%202018%20-%202032.pdf
18
 2016-2018 tariff methodology uses a reimbursement model: recognizes
costs, retributes investments, and directs an efficiency path.

Required
income = + + Capital
- Efficiency
CFE Transmisión costs
expenditure path

Operating Cost of assets: Return on capital. Set at 1% annually

costs: labor, depreciation, based on the
maintenance, financial cost of regulator analysis.
services, debt.
materials, taxes
and rights.

Required income is assigned to consumers and generators (70% and 30%, respectively) and divided by
volume at two different tension levels.1

Annual adjustments: 90% weight on inflation and 10% on exchange rate.

New investments have to be included in the National Electric System Development Program 2 (PRODESEN).

Source: 1Acuerdo A/045/2015 (content in Spanish) http://www.cre.gob.mx/documento/acuerdos/A-045-2015.pdf, CFE, and CFECapital.

2PRODESEN 2018-2032, Secretaría de Energía.

19
On December 28, CRE decided to extend the validity of the current
methodology. For 2019, the average increase will be of 4.9% versus 2018.

CRE assumptions1:

1. Required Income for the year 2019 (MXN $55,901 million).

2. Variation of the Producer Price Index2 between October 2018 and October 2015
(22.53%).
3. Exchange rate variation3 between October 2018 and October 2015 (15.29%).
4. Update factor of 21.81%.
5. There are not approved projects that start operations in 2019, hence there are no
new investments recognized in the Required Income.
6. Energy demand based on the low scenario growth rate: 2.6%.

These rates will be valid as long as the new methodology is not

issued. Rate chart that valid since January 1, 2019:

Producers Consumers
Tension level
(MXN / kWh) (MXN / kWh)

Tension > 220 kV 0.0580 0.0730

Tension < 220 kV 0.1051 0.1663

Source: 1Acuerdo A/045/2015 http://drive.cre.gob.mx/Drive/ObtenerAcuerdo/?id=452 2Producer Price Index, Total

Production, Source Classification (SCIAN 2007) of INEGI http://www.beta.inegi.org.mx/app/tabulados/default.aspx?nc=ca80 3Bank of
Mexico exchange rate publications http://www.anterior.banxico.org.mx/portal-mercado-cambiario/

20
 CFE keeps working with CRE on the new methodology. While it still uses
required revenue, it becomes referential to market parameters.1

Required
income = Operational retribution
+ Asset base
+ New investments
+
based on referential Investment retribution Others
costs

Operation and Assets in operation Return on capital Income removal,

maintenance adjusted by based on market miscellaneous
plus depreciation and parameters income
depreciation useful life adjustments,
incentives

The next steps in the process are: 1) revision and approval by the regulatory agency of the Federal
Government (methodology draft will be public), simultaneously, CFE and CRE are working on the numbers
source for each component; 2) CRE governing body will approve it and decide when to enact new rates.

Source: 1This analysis is made according to the latest draft that CFECapital has studied. Key criteria may change according to CRE
decisions.

21
Agenda

1 Mexican power sector

2 CFE at a glance

3 CFE Transmisión

4 FCFE results and prospective

22
CFE Fibra E objective during 2018 was to consolidate operations and
deliver results to investors.

Agreement The Promoted Trust received around

MXN $62.41 billion in 2018.
Collection rights

Weekly collection rights were on

average 10% higher in comparison with
2017: tariffs increased 4.2%2 and volume grew
Promoted
Trust
around 4% compared to 2017.

Distributions Distributions
(93.22%) (6.78%)
In 2018, reimbursements to CFE
CFE Transmisión summed up MXN $13.2
Transmisión Reimburses costs Fibra E billion, saving 21% of the approved budget.
and expenses
CBFI holders

The Issuer Trust distributed MXN $2.483 billion

to CBFE4 holders. Two of the three
distributions have exceeded the MQD.5
Investors

Source: CFECapital and CFE Transmisión.

Note: All rounded and preliminary figures. 1Estimated amount since the Initial Public Offering in February 12 2018. 2Approved by the Energy
Regulatory Commission. 3First distribution: 729 million MXN; Second distribution: 932 million MXN; Third distribution: 819 million MXN. 4CBFE:
Certificados Bursátiles Fiduciarios de Inversión en Energía e Infraestructura. 5MQD: Minimum Quarterly Distribution.

23
Preliminary figures show reimbursement savings of around MXN $3.5
billion for the end 2018.1 Budget approved for 2019 only considered a
inflation increase.2

Reimbursements made vs 2018 budget

(million MXN)

Category 2018 budget End of 2018 % against budget

Intercompany expenses 6,789 4,926 73%
Operation and maintenance 5,998 5,623 94%
Obligations expenses 3,134 2,480 79%
Major maintenance 856 210 25%
Trust expenses 15 1 4%
Financing 0 0 0%
Total 16,792 13,240 79%

The budget approved for the promoted trust contemplates 46 weeks of operations
since February 12 2018 until the end of 2018.

Source: CFECapital and CFE Transmisión.

Note: All rounded and preliminary figures. 1Final figures may differ. 2Base budget was 2018 original budget. This figure may vary due to
CFE Holding budget adjustments.
24
Last distribution reflected the consolidation of the growth path showed
earlier in the year.

Weekly revenues from CENACE

(million MXN)
1,700

1,600 1,568

1,500 1,452
1,428
1,400 1,368
1,317
1,300
1,244

1,200

1,100

1,000

900

800
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2016 2017 2018 Avg Q2 2018 Avg Q3 2018

Avg Q2 2017 Avg Q3 2017 Avg Q4 2017 Avg Q4 2018

Source: Promoted Trust statement of account.

Note: Q2 2018 distribution: February 12 to May 31; Q3 2018 distribution: June 1 to August 31; Q4 2018: September 1 to November 30.
Comparison for 2017 considers equivalent periods. Rounded figures.
25
Last distribution (Q4): 0.7202 per CBFE of each series.

Revenue composition of distributions on 2018

(MXN per CBFE1)

MQD for the Q2 2018 0.1748

collection period was MXN
0.575*(1.19) per CBFE.

0.2004 0.2004
0.1452 0.1452
0.1748

0.6843
0.5750 0.5750 0.5750 0.5750
0.5094

Series "A" Series "B" Series "A" Series "B" Series "A" Series "B"
Q2 2018 Q3 2018 Q4 2018

MQD Pro rata distributions Unpaid MQD

Note: 1Certificado Bursátil Fiduciario de Inversión en Energía e Infraestructura (CBFE). Q2 2018 distribution: February 12 to May 31; Q3 2018
distribution: June 1 to August 31; Q4 2018: September 1 to November 30.

26
 Key activities for 1H 2019.

Approval of the new tariff methodology CFE Fibra E leverage

(estimated) • Defining level and strategy.
• Regulatory revision and model testing
Jan 2019 with final numbers. • Approval by committees, general assembly, and CFE
Board.
• As soon as the information is public
CFECapital will offer a webcast on key • Use: increase participation in the Promoted Trust.
changes.

Upcoming distributions
March 29, 2019
(MQD: MXN 0.575 per certificate)1

June 28, 2019

June 2019

Source: CFECapital. 1MQD established in the offering documents. 2 Comisión Nacional de Mejora Regulatoria.

27
 CONTACT
investor@cfecapital.com.mx
http://cfecapital.com.mx/
 Series “B” CBFEs hold by CFE are permanently subordinated to the
Series “A” hold by investors with respect to distributions.1

Minimum MXN 0.575 per

Quarterly certificate
Distribution 100% 100%

CBFE Series “A”

CBFE Series “B”

Pro-rata distributions

Unpaid distributions Unpaid distributions Distributions made on a pro-

rata basis to Series “A” and
100% Minimum 100% Minimum Series “B” CBFEs holders
Quarterly Distribution Quarterly Distribution

Subordinated Series

Source: Offering filings and CFECapital. 1 Offering Memorandum http://cfecapital.com.mx/wp-content/uploads/2018/05/Offering-Memorandum-

FCFE18.pdf

29
 Corporate governance of CFE Fibra E guarantees transparency,
efficiency in the operation, and shared responsibility.
Composition • Approve leverage guidelines² and
• Changes to the CENACE changes to the investment regime.
Promoted
agreement.1 Trust • Additional issuances.
• Budget and reimbursement • Approve independent members of
oversight.1 Technical Holders Technical Committee.
Committee meeting

• Review manager’s
• Investor relations. performance.
• Performance reports and
CFE Technical
Committee • Approve Amount to de
distributions. Fibra E Distributed and debt,
• Investments and acquisitions. including its restructuring and
refinancing.

• Discuss and approve • Compliance with accounting

distribution ratio. Conflicts Audit policies, internal control rules,
Committee Committee and Audit rules.
• Approve management key
Nominations
executives. Committee • Review financial statements.

• Proposes substitutes for

independent members.
CFE-designated members
Independent members

Source: Offering filings and CFECapital. 1All decisions require independent members approval. ²Leverage rules require approval of the
Technical Committee and the corrective plan needs approval of the Conflicts Committee.

30
 Transmission Line Yautepec – Ixtepec and the Baja California (BC) –
National Interconnected System (SIN) interconnection.

BC-SIN Interconnection
(MXN $22,000 million)* How? The project consists on the construction, modernization operation
and maintenance of 1,221 km of transmission lines with a 3,000 MW
What? Interconnect the capacity, at ±500 kV voltage. It includes 2 converter stations, 7
SIN to the isolated BC substations, 5 HVAC transmission lines and 1 HVDC transmission line.1
Systems.
Why? To transport wind energy generated in the
Where? The project will go Tehuantepec Istmo to Central Mexico whilst
from Seri, Sonora to improving the transmission system along the way.
Cucapah, Baja California.
When? Feb 2018 – tender
called on; Feb 2019 – offering
When? Feb 2019 – tender called on; proposals; Mar 2019–
Feb 2019 – offering proposals; Mar contract assigned.
2019– contract assigned.
Where? The project will go
from Ixtepec, Oaxaca to
Why? To reduce potential wind and solar PV Yautepec, Morelos, crossing
generation costs, improve BC System’s efficiency Oaxaca, Veracruz, Puebla,
HVDC Yautepec-Ixtepec State of Mexico, Mexico City
and reliability and modernize it through smart grid
technologies. (MXN $24,000)* and Morelos.

How? The project will be 700 km long, use bipolar point to point High Voltage What? To interconnect existing wind
Direct Current (HVDC) with a 1,500 MW capacity, at ±500 kV voltage. It will also generation in Mexico Southeast to
have two Voltage Source Converters (VSC) with an 1,800 MVA transformation Central Mexico.
capacity.
* Initial project estimates. These might be adjusted as the project evolves. More detailed information can be found on the official project’s webpages.

Source: (Content in Spanish) - SENER, National Electric System Development Program. SENER, International Public Tender SENER-01-
2018. CFE, Procedure CFE-0036-CASOA-0001-2018. Mexico Projects, 0716 Interconnection of the Electric System of Baja California with
the National Interconnected System. Mexico Projects, 0024 CFE: HVDC Transmission line Yautepec – Ixtepec.
Note: 1The AC projects will be paid periodically until conclusion. The DC project will be managed by a trust and handed to CFE for
possession, use and exploitation rights upon complete payment. 31
PRODESEN relevant figures.

Variable Period Value Observations

High 3.6%
GDP forecasted annual growth rate 2008-2032 3.2%
Low 2.5%
Generation 84%
Total investment 2018-2032 MXN $2.004 trillion Transmission 9%
Distribution 7%

SEN electricity gross consumption 2017 309,727 GWh -

SEN electricity gross consumption High 3.5%

2018-2032 3.1%
forecasted average annual growth rate Low 2.5%

SIN maximum instantaneous demand 2017 44,668 MW June

June 23,
SIN maximum simultaneous demand1 2017 43,319 MWh/h
16:00-17:00
Fossil fuels 70.5%
Total installed capacity2 2017 75.7 GW Renewables 24.4%
Other clean 5.1%

Source: (Content in Spanish) - SENER, National Electric System Development Program.

Note:1The maximum simultaneous demand is the maximum demand of a set of combined systems; it is equivalent to the maximum
demand if the system was unique. It is lower than the annual maximum demands observed in each region as maximum regional demands
happen in different instants. It is a unit of average power during certain period, and it shows energy consumption. 2Fossil fuels include
combined cycle, thermoelectric, carboelectric, turbo gas, internal combustion and fluidized bed. Renewable includes hydroelectric, wind, 32
geothermal, solar PV and distributed generation. Other clean include nuclear, bioenergy, efficient cogeneration and regenerative breaks.
Ministry of Energy and CRE. 1

Energy Minister2 Energy Regulatory Commissioners

• Norma Rocío Nahle García • President Guillermo Ignacio García Alcocer (2016 – 2022)
• Born April 14, 1964, Río • Specializes in technical and economic regulation, public
Grande, Zacatecas. policy design, evaluation and business development.

Education: • Guillermo Zúñiga Martínez (2013 – 2017) & (2017 – 2023)

• B.S. in Chemical Engineering, • Focuses in regulation and competitiveness of the energy
(concentration in Petrochemestry) at sector.
Zacatecas Autonomous University3.
Professional Experience: • Jesús Serrano Landeros (2014 – 2018)
• Has worked in PEMEX’s administrative, • Focuses in finance, public finances, political economy,
financial, processes, planning and policy analysis, heavy industry and the power sector.
quality control areas.
• Has worked in Resistol Industries in • Cecilia Monserrat Ramiro Ximénez (2014 – 2019)
projects and planning. • Focuses on energy, energy finance, environmental
• Has been Energy Advisor for the economy and natural resources.
Chamber of Deputies (LIX and LXI leg).
and the Senate (LXII leg).
• Deputy for MORENA (LXIII leg). • Marcelino Madrigal Martínez (2014 – 2021)
• Senator for MORENA (LXIV leg). • Specializes in development banking operation, technical
and economic planning of electricity markets.
Affiliations:
• PEMEX Engineers Group (C-17).
• LAC4 National Committee of Energy • Luis Guillermo Pineda Bernal (2016 – 2022)
Studies (CNEE). • Focuses on public finance and the energy sector, with
• LAC Workers’ Energy Studies Institute emphasis on oil.
(IEETALC).
Source: (Content in Spanish) – CRE, Government Body. Rocio Nahle, Know me. Lopez Obrador, Rocío Nahle - Experience. DOF, Law of
the Coordinated Regulatory Bodies on Energy Matters.
Note: 1Annual succession in 7-year terms. In case of an anticipated vacancy, the new appointee can only cover the remaining period as
his/her first term. 2Appointed by the new administration (2018–2024). 3Also, certification courses on Chemical Process Engineering and in
Economic Engineering and Strategic Analysis. 4Latin America and the Caribbean. 33
Fiscal result of distributions has been the result of CFECapital strategy
to meet the tax requirements of the instrument.

Fiscal composition of 2018 distributions

(MXN per CBFE)

0.2710

0.2212 0.0770 0.0770

0.2336

0.1739
0.6792 0.6431 0.6431
0.5542
0.4506
0.3355

Series "A" Series "B" Series "A" Series "B" Series "A" Series "B"
Q2 2018 Q3 2018 Q4 2018

Distributable profit Capital reimbursement

Source: CFECapital.

34