SÃO PAULO STATE GOVERNMENT ARSESP RESOLUTION Nº 514 It approves the consumption reduction ranges for tariff bonus of SABESP’s Water Consumption Reduction Incentive Program. The Executive Board of the São Paulo State Sanitation and Energy Regulatory Agency - ARSESP, based on the authority conferred thereto by Supplementary Law n° 1,025 of December 7, 2007, and - considering ARSESP Resolution nº 469 of February 3, 2014; ARSESP Resolution nº 480 of March 31, 2014 and ARSESP Official Letter OF.P-0068- 2014 of May 26, 2014, related to the implementation and expansion of the coverage area of the Water Consumption Reduction Incentive Program; - considering the Official Letter P-0686/2014 of October 21, 2014, sent by Sabesp, which after informing the outcome of referred program and “taking into account the critical state and worsening of water conditions and aiming at increasing the population’s participation in the program, besides keeping motivated those who reduced consumption, but did not achieve the target”, Sabesp requests the approval on an emergency basis of the proposal for having consumption ranges for tariff bonus ; RESOLVES: Article 1 – Approve the changes requested by SABESP to set consumption reduction ranges on tariffs, due to lower consumption. SÃO PAULO STATE GOVERNMENT Article 2 – The Consumption Reduction Ranges for tariff bonus during the effectiveness of the Water Consumption Reduction Incentive Program will be: (a) A thirty percent (30%) bonus for customers whose monthly consumption falls by at least twenty percent (20%) in relation to the average consumption between February 2013 and January 2014. (b) A twenty percent (20%) bonus for customers whose monthly consumption falls by at least fifteen percent (15%) and below twenty percent (20%) in relation to the average consumption between February 2013 and January 2014. (c) A ten percent (10%) bonus for customers whose monthly consumption falls by at least ten percent (10%) and below fifteen percent (15%) in relation to the average consumption between February 2013 and January 2014. Article 3 – The scheduling of bonus ranges shall be applied by Sabesp to all municipalities, which currently already receive the tariff bonus: (a) The metropolitan region of São Paulo: São Paulo, Arujá, Barueri, Biritiba- Mirim, Caieiras, Cajamar, Carapicuíba, Cotia, Diadema, Embu das Artes, Embu-Guaçu, Ferraz de Vasconcelos, Francisco Morato, Franco da Rocha, Itapecerica da Serra, Itapevi, Itaquaquecetuba, Jandira, Mairiporã, Mogi das Cruzes (Divisa neigborhood), Osasco, Pirapora do Bom Jesus, Poá, Ribeirão Pires, Rio Grande da Serra, Salesópolis, Santana de Parnaíba, São Bernardo do Campo, Suzano, Taboão da Serra and Vargem Grande Paulista; (b) Bragança Paulista Region: Bragança Paulista, Joanópolis, Nazaré Paulista, Pinhalzinho, Piracaia and Vargem; (c) Campinas Region: Hortolândia, Itatiba, Jarinu, Monte Mor, Morungaba and Paulínia. SÃO PAULO STATE GOVERNMENT Article 4 – This Resolution takes effect on the date of its publication. SÃO PAULO SANITATION AND ENERGY REGULATORY AGENCY - ARSESP, ON OCTOBER 22, 2014. José Luiz Lima de Oliveira Technical Regulation and Inspection Officer of Sanitation Services acting as Chief Executive Officer Published in the Official Gazette of 10/ /2014 .