Exhibit 1

[ESCELSA logo]



                ESPIRITO SANTO CENTRAIS ELETRICAS S.A. - ESCELSA

                                     BYLAWS



      Denomination, Organization, Main Offices, Activity Period, Objectives


First Clause. Espirito Santo Centrais Eletricas S.A. shall use the abbreviation
ESCELSA and as a corporation it shall have its activities thereto ruled by
bylaws and legislation in force.

Second Clause. ESCELSA has its main offices in the city of Vitoria, its activity
period shall be indeterminate and it may establish branches, subsidiaries,
agencies and offices anywhere within the country.

Third Clause. Social Objectives:

a) To carry out studies, projects, constructions and operations of production
mills, transmission lines and distribution of electric power, as well as to
enter into trading acts arising from such activities, while retaining the right
to simultaneously join other corporations for the accomplishment of other
projects;

b) To develop activities associated with the rendering of electric power
service, such as: multiple use of electric power poles, through assignment to
other users; data transmission through installations while observing relevant
legislation; rendering of operational technical services, maintenance and
planning of third party electrical installations; optimization services of
energy processes and consumer electrical installations, supply of expensive
assignment lines, land subject to mill exploration, and reservoirs for better
electric power use and supply;


c) To join study groups, syndicates, association groups or any other entity for
research purposes in the energy sector or for the training of technical
personnel which may be deemed necessary, as well as for the rendering of
technical, operational and administrative support services to electrical power
subsidiary companies in the public sector.

                                Equity and Shares

Fourth Clause. The share capital is R$ 153.946.942,07 (one hundred and fifty
three million, nine hundred and forty six thousand, nine hundred and forty two
reais and


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seven cents), divided into 4.550.833 (four million, five hundred and fifty
thousand, eight hundred and thirty three nominative common shares), without
nominal value.

First Paragraph - Each common share shall correspond to one vote in the General
Assembly resolution.

Second Paragraph - Escelsa's shares are indivisible and for each share, only one
owner is recognized.

Fifth Clause. The Company shall be authorized to increase its share capital up
to a limit of R$ 1.000.000.000,00 (one billion reais), through resolution of the
Board of Directors and regardless of statutory reform.

First Paragraph - Within the limits of the authorized capital, the Board of
Directors shall deliberate over the issuing of subscription warrants. At the
Board of Directors' discretion, the right of first refusal may be ruled out for
primary offerings, debentures, and subscription warrants, for which placement is
carried out in the stock exchange or through public or private share issues, and
in the case of of a share exchange, through public offering of interest
acquisition, under the terms established by law.


Second Paragraph- Within the limits of the authorized share capital, and in
accordance with the authorized plans of the General Assembly, ESCELSA may grant
a share acquisition option to its administrators and employees, or to natural
person that renders services to the Company, without shareholders' right of
first refusal.

Sixth Clause. Payment of subscribed shares shall comply with the norms and
conditions established by the Board of Directors up to the limit stated in
Clause 5 and by the General Assembly, should such limit be exceeded.


Sole Paragraph - The shareholder that does not effect payment in accordance to
the norms and conditions related hereto shall incur in culpable delay a 12%
(twelve percent) interest per annum plus monetary correction, plus a 10% (ten
percent) fine on overdue installment.

Seventh Clause. ESCELSA may issue multiple shares in a quantity under 100 (one
hundred) shares. Shareholders shall bear the costs for the splitting or reverse
splitting of shares that shall be carried out upon request, and the expenses
shall not exceed the costs thereof.


Sole Paragraph - Conversion, transference and splitting of shares may be
temporarily discontinued while observing norms and limitations established by
legislation currently in effect.


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                                   Governance

Eighth Clause. The Board of Directors and an Executive Board shall govern
escelsa, the former being a deliberative functional collegiate body with
attributes foreseen by the law and without prejudice to those already stated in
the bylaws.

First Paragraph - Employees and retirees from ESCELSA, employees and retirees
from ESCELSOS, jointly exercising an inherent vote of shares acquired in the
Employees Offer, shall have the right to elect a member to ESCELSA's Board of
Directors.

Second Paragraph - A minute to be transcribed in a proper book shall be drawn
and signed by all attending members and the resolutions upon which action should
be taken regarding third parties shall be filed at the Board of Trade and
published thereafter.

Third Paragraph - Upon completion of the mandate, the administrators shall
remain in the exercise of their capacities until the election of their
successors.

Ninth Clause. ESCELSA may have committees, which shall have consulting,
executing, or temporary capabilities to analyze and advise on any issues,
composed of at least 3 (three) members appointed by the Board, regardless of
whether they are Board members, and presided over by the President.

Tenth Clause. The Board of Directors shall be composed of at least 9 (nine)
members, with a 3 (three) year mandate, and the appointment of one President,
one Vice-President and the remaining Counselors. The President and
Vice-President of the Board shall be appointed by the General Meeting.

Sole Paragraph -The appointment of the majority members of ESCELSA's Board
of Directors shall be secured? to the Brazilian shareholders or companies under
Brazilian law headquartered in the country.


Eleventh Clause. Escelsa's Executive Board shall be composed of a President
Director and up to 5 (five) Directors, elected by the Board of Directors with a
mandate of 3 (three) years, and full time exercise of their functions.


Twelfth Clause. The Board of Directors and Executive Board term of office shall
be made through an appropriate filing in the books.


Thirteenth Clause. The Board of Administration and Executive Board shall be
established and shall deliberate in the presence of the majority of members.


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Fourteenth Clause. It shall be the Board of Directors' responsibility to
determine ESCELSA's general business goals, as well as ESCELSA's absolute
control, the supervision for compliance of guidelines, follow-up of approved
program execution and observation of the accomplished results.

Sole Paragraph - The Board of Directors in its attribution practice shall
deliberate over the following:

I - Loans to be taken in the Country or abroad in an amount above that which was
forecast on the third paragraph of the aforementioned clause;

II- Granting of guarantees of loans taken in the country or abroad, in an amount
above the forecast on the third paragraph of hereto clause;

III- Contracts for civil construction, undertakings, supervision, renting of
services, consulting, supply and the like that would involve amounts above the
forecast on paragraph three of the aforementioned clause;

IV - Officers' election and dismissal, and establishment of their attributions;

V - The company's administrative structure;

VI - the supervision of the company's management, including the request for
information or examination of files and documents;

VII - Call for General Meetings;

VIII - Management report and Executive Management account;


IX - issue of Company's shares within the limits authorized on Clause 5, setting
issuing conditions including price and term for payment, with power to rule out
right of first refusal for the issuing of shares and subscription warrants,
which placement should be made through the selling on the stock exchange or by
private or public offering, through exchange of shares on takeover bid under the
terms established by law;

X - issuing of subscription warrants as forecast on the first paragraph, clause
5 of the Bylaws, and issuing of promissory notes as security, while setting
related conditions to each operation thereto;

XI - Grant of call options to its officers and employees or to natural people
that render services to the Company, without right of first refusal to the
shareholders;

XII - the choice and dismissal of independent auditors;


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XIII - ESCELSA's estimate for total revenue, expenses and capital expenditure in
each period, to be determined by the Executive Board;

XIV - the establishment and appointment of committee members as outlined in the
Ninth Clause;

XV- the number of officers that shall constitute the Executive Board as provided
for on the Eleventh Clause;

XVI - approval for new capital expenditure and/or financing, which amount
implies that ESCELSA's total indebtedness exceeds 15% (fifteen per cent) of its
net equity, as of the last reported balance sheet or in accordance to any other
amount set from time to time;

XVII - use or exploration, at any title and by any person or entity, of
equipment, facilities, assets and other of ESCELSA's operational assets, which
amount exceeds that forecast on the third paragraph of the relevant article;

XVIII - setting of ESCELSA's management profit sharing

XIX - choice, hiring, and dismissal of any subsidiary's management;

XX - participation or refusal of tender for ESCELSA's public service concession,
as well as acceptance or rejection of any alteration of terms or cession of
rights arising from such concession;

XXI - establishment of mortgage on ESCELSA's assets, whenever the amount for
total assets encumbered by ESCELSA exceeds 5% (five per cent) of net equity, as
of the last reported balance sheet;

XXII - suggestion of plans related to admission, career, access, advantages and
discipline for ESCELSA's employees;

XXIII - selling or acquiring of permanent assets, which amount exceeds 5% (five
per cent) of the amount of the same asset, as of the last reported balance
sheet;

XXIV - authorization for stock buyback for the effect of canceling or
withholding at ESCELSA's treasury department and future selling; and

XXV - the omitted cases of bylaws hereto;

Second Paragraph - At each fiscal year, The Board of Directors shall examine and
submit to the decision of the Ordinary General Meeting, the Annual Report,
Balance Sheet, Statement of Profit and Losses Carried Forward, Income Statement
and Statement of Changes in Financial Position, as well as Profit Sharing
proposals and use of surpluses, while attaching the Fiscal Council Opinion and
the Independent Auditors Certificate.



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Third Paragraph - The amount referred to on items I, II, III, and XVII from the
first paragraph of the clause shall be 1% (one percent) of net shareholders'
equity as of the last reported fiscal year balance sheet.

Fifteenth Clause. The Board of Directors shall meet every two months or whenever
called by the President or the majority of board members.

Sixteenth Clause. In case of absence, temporary encumbrance or vacancy, the
Vice-President shall replace the president of the Board, assuming both
capacities until the General Meeting elects the new President.


                              Executive Management

Seventeenth Clause. The Executive Management shall be the administrative
executive body, within the scope designed by the General Assembly and the Board
of Directors, while securing Escelsa's regular functioning. The Executive Board
shall be endowed with full administrative and management powers to deliberate
over any issues related to the social objectives, except certain special items,
which by nature or under the Bylaws hereto shall be the responsibility of the
General Meeting or the Board of Directors;

First Paragraph -Candidates for the Board of Directors shall be appointed by the
President and elected by the Board of Directors.


Second Paragraph - While exercising their capacities, the Board of Directors
shall have the following responsibilities among the inherent assignments of the
general administrative and managerial powers which are not expressly granted
under the Bylaws:


a)       To propose fundamental administrative guidelines for deliberation by
         the Board of Directors;

b)       To establish administrative, technical, financial and accounting
         principles for ESCELSA;

c)       To make plans for issuance of negotiable instruments to be submitted to
         the Board of Directors.

d)       Effect revenue forecast, provision for general expenses and estimate of
         ESCELSA's capital expenditure to be submitted to the Board of
         Directors on each fiscal year and upon approval, while effecting its
         due control thereto;

e)       To create and execute ESCELSA's budget;



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f)       To submit proposals to the Board of Directors related to admission,
         career, assessment, advantages, and discipline system for all ESCELSA
         employees;

g)       To empower the Board's President and Directors to decide, separately
         over issues that are the Executive Board's responsibilities;

h)       To empower the CEO, Directors and employees to authorize expenses while
         establishing limits and conditions


i)       To elaborate at each fiscal year ESCELSA's balance sheet, income
         statement, Profit and Losses carried forward, Statement of Changes in
         Financial Position, Profit Sharing Proposal and investment of surpluses
         for submission, if need be, for appraisal by the Supervisory Board,
         Independent Auditors, Board of Directors, and examination and
         deliberation for the General Meeting.

Eighteenth Clause. The Executive Management shall meet at least once a month and
whenever necessary.


Nineteenth Clause. It shall be the President Director's responsibility to guide
the administrative policy and ESCELSA's representation, calling and presiding
over the Executive Management meetings

Twentieth Clause. The following shall be the President Director's
responsibility:

a) To supervise ESCELSA's business;

b) To represent ESCELSA in court or outside it, before other entities,
shareholders and the general public, empowering any Director as well as
accrediting representatives and agents;

c) To manage the publishing of ESCELSA's annual report;

First Paragraph - All acts and instruments that create, modify or extinguish
ESCELSA's liabilities, in the opening, transaction or closing of current
accounts, endorsements of checks issued on ESCELSA's behalf for deposit in
third-party accounts, in the endorsement of checks for deposit on ESCELSA's
current account, shall be jointly signed by 2 (two) Directors, or 2 (two)
attorneys with special powers, or by 1 (one) Director and 1 (one) attorney with
special powers.

Second Paragraph - The Company shall be represented by any Director or attorney
in all meetings of corporations in which Escelsa is a significant shareholder or
quota holder. The latter shall only act within strict limits determined through
the specific authorization of the Board of Directors for the alluded meeting or
General meeting.




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Third Paragraph - the attorney's "ad negotia" shall be established through a
mandate within a period that shall not exceed 1 (one) year, and such mandate
shall be signed by 2 (two) Directors.

Twenty-first Clause. The President Director and the Directors, besides their own
duties and responsibilities, shall manage the activity areas assigned to them by
the Board of Directors and those responsible by the choice and attributions of
their subordinates.


                                Supervisory Board

Twenty-second Clause. The Supervisory Board shall be permanent and shall have 3
(three) substitutes elected by the General Meeting, each with a one-year
mandate, whether they are shareholders or not.


                                 General Meeting

Twenty-third Clause. The Common General Assembly shall be held within the first
four months following the closing of the fiscal year, with a fixed date and
time, in order to:


I -Hear the administrators' account, and examine, discuss and vote on the income
statement;

II -  Deliberate over the fiscal year net income destination and profit sharing;

III - Elect, whenever applicable, the Board of Directors and Supervisory Board
members and fix their respective fees, as well as the fees for the Executive
Management; and

IV - Approve the monetary correction of the share capital.


Twenty-fourth Clause. Apart from those issues foreseen by the law, the General
Meeting shall be convoked whenever the Board of Directors may find it
convenient, and particularly to deliberate over the following:

I - Subscription rights, resignation of shares and convertible debentures in
shares as well as their sale, should they be in treasury;




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II - split-up, or ESCELSA's downstream or upstream mergers, as well as
winding-up, corporate liquidation or any of ESCELSA's voluntary acts of
financial re-organization; and


III - Share exchange or other negotiable instrument issued by ESCELSA or any of
subsidiaries thereof.

Twenty-fifth Clause. The General Meeting tasks shall be directed by a Bureau
composed by the President of the Board of Directors, or in the case of his or
her absence or impediment, by whomever the General Meeting chooses together with
one secretary to be chosen among those present.

Twenty-sixth Clause. The Official Publication shall be conditional upon the
shareholders' presence at the General Meeting, as well as compliance to the
following requirement, besides others foreseen in law: in the case of
shareholders under custody, presentation of the deposit document, at ESCELSA's
main office, and voucher issued by the depositary financial institution.

First Paragraph - The deposit of documents referred hereto shall be required for
up to 72 (seventy two) hours before the General Meeting takes place.

Second Paragraph - The public notice call shall also have the condition that
shareholder presence at the General Meeting be subject to the deposit of
respective documents at ESCELSA's main office up to 72 hours before the General
Meeting takes place.

                        Fiscal year and Income Statement


Twenty-seventh Clause. The fiscal year shall close at December 31st each year
and shall comply with the precepts of the federal legislation under electric
power, in what concerns the Income Statement, the legislation on joint stock
companies and Bylaws.

First Paragraph - The earnings shall comply to the following rules:

I - From the Net Income in the period shall be deducted losses carried forward
and income tax provision;

II - From the Net Income, 5% (five percent) shall be invested in Statutory
Reserve Constitution and shall not exceed 20% of share capital;

III - On each fiscal year a compulsory 25% (twenty five percent) dividend
distribution of net income shall be effected and adjusted under the terms of
law;

IV - ESCELSA may capitalize interest on capital expenditure which were effected
with the use of equity on work in progress;



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V - Other reserves may be constituted, under the form and legal limits.


Second Paragraph - The dividend discussed under item III of the first paragraph
hereto shall not be compulsory in the fiscal year in which the administration's
entities inform the Ordinary General Meeting that it is not compatible with
ESCELSA'S financial situation. The Supervisory Board shall manifest over such
information.


Third Paragraph - Income which is not shared as a special reserve under the
terms of the second paragraph and is not absorbed by losses carried forward from
previous fiscal years shall be distributed as soon as the Company recovers its
financial status again.

                              General Dispositions

Twenty-eighth Clause. In order to secure the effective and permanent Brazilian
headquartering and control of the company under Brazilian law, as well as the
obligation of the controllers and ESCELSA's Board of Administration to support
the legal and ruling norms and contractual dispositions related to the public
services granted, the following rules should be observed by shareholding
entities:


I - Alteration of Statutory clauses shall be subject to previous approval of
Granting Power, and alterations of Bylaws shall be expressly prohibited, as well
as meeting deliberations that imply exclusion or limitation of Brazilian control
of the share capital or the company, constitution under Brazilian Laws,
headquartering in Brazil, and other such issues related to the change of
ESCELSA's corporate objectives;


II - Transfer, assignment, alienation, and taxation under any title or
circumstances, direct or indirect, gratuitous or onerous from the total or part
of voting shares and/or subscribing rights or stock dividend distributed on
account of profit capitalization or ESCELSA's reserve shall be subject to
previous and express agreement of Granting Power.


III - Transference of voting shares, rights ownership or shareholder agreements
that imply exclusion or limitation of ESCELSA's Brazilian shareholding control,
the company's incorporation under Brazilian law, and the maintenance of its
headquarters within the country may not be registered on ESCELSA's books or in
the share certificates;

IV - Transference of voting share ownership rights which are an integral part of
the control block under ESCELSA's Share Registration Book may not be registered,
in case the new shareholder shall not sign, together with the transference term,
a



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statement in compliance with all clauses and conditions established in the
Granting Contract. Such statement shall be issued in two copies, one of which
shall be filed at ESCELSA's main office and the other to be forwarded to the
Granting Power;


V - The following term shall be registered on the margin of the controlling
ownership share registration: "These shares may not be charged, assigned or
transferred under any circumstances, without previous and express consent of the
Granting Power."


Twenty-ninth Clause. The Board of Administration shall exercise the attributions
for the faithful observation of all legal and governing laws and contractual
dispositions related to the rendering of services of electric power; and the
company will enact the necessary capital expenditure for the maintenance and
improvement of such services, targeting the adequate user's service.


Thirtieth Clause. A specific chapter on the activities and capital expenditure
shall be included in the Management Report.

                ________________________________________________


Note:  The Extraordinary General Meeting consolidated Bylaws dated March 1st,
       1999, which minutes were registered at Espirito Santo Board of Trade,
       under the number 990070832, on March 8th, 1999.







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