10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2013

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 1-12291

THE AES CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	54 1163725
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4300 Wilson Boulevard Arlington, Virginia	22203
(Address of principal executive offices)	(Zip Code)

(703) 522-1315

Registrant’s telephone number, including area code:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer x	Accelerated filer ¨	Non-accelerated filer ¨	Smaller reporting company ¨
		(Do not check if a smaller     reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ¨    No  x

The number of shares outstanding of Registrant’s Common Stock, par value $0.01 per share, on May 3, 2013 was 746,540,903.

THE AES CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2013

TABLE OF CONTENTS

PART I: FINANCIAL INFORMATION		1
ITEM 1.	FINANCIAL STATEMENTS	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Comprehensive Income	3
	Condensed Consolidated Statements of Cash Flows	4
	Notes to Condensed Consolidated Financial Statements	5
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	29
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	59
ITEM 4.	CONTROLS AND PROCEDURES	62
PART II: OTHER INFORMATION		63
ITEM 1.	LEGAL PROCEEDINGS	63
ITEM 1A.	RISK FACTORS	71
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	71
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	71
ITEM 4.	MINE SAFETY DISCLOSURES	71
ITEM 5.	OTHER INFORMATION	71
ITEM 6.	EXHIBITS	71
SIGNATURES		72

PART I: FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

THE AES CORPORATION

Condensed Consolidated Balance Sheets

(Unaudited)

	March 31, 2013			December 31, 2012
	(in millions, except share and per share data)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,301		$	1,966
Restricted cash		760			748
Short-term investments		851			696
Accounts receivable, net of allowance for doubtful accounts of $314 and $306, respectively		2,633			2,671
Inventory		755			766
Deferred income taxes		231			222
Prepaid expenses		256			230
Other current assets		1,403			1,103
Current assets of discontinued operations and held for sale assets		68			63
Total current assets		9,258			8,465
NONCURRENT ASSETS
Property, Plant and Equipment:
Land		1,019			1,007
Electric generation, distribution assets and other		32,210			31,656
Accumulated depreciation		(9,745	)		(9,645	)
Construction in progress		2,528			2,783
Property, plant and equipment, net		26,012			25,801
Other Assets:
Investments in and advances to affiliates		1,195			1,196
Debt service reserves and other deposits		593			565
Goodwill		1,999			1,999
Other intangible assets, net of accumulated amortization of $193 and $276, respectively		417			429
Deferred income taxes		986			996
Other noncurrent assets		2,153			2,240
Noncurrent assets of discontinued operations and held for sale assets		105			139
Total other assets		7,448			7,564
TOTAL ASSETS	$	42,718		$	41,830
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable	$	2,951		$	2,631
Accrued interest		415			295
Accrued and other liabilities		2,251			2,505
Non-recourse debt, including $424 and $282, respectively, related to variable interest entities		3,108			2,829
Recourse debt		507			11
Current liabilities of discontinued operations and held for sale businesses		54			48
Total current liabilities		9,286			8,319
NONCURRENT LIABILITIES
Non-recourse debt, including $1,118 and $1,076, respectively, related to variable interest entities		12,815			12,554
Recourse debt		5,454			5,951
Deferred income taxes		1,239			1,237
Pension and other post-retirement liabilities		2,389			2,455
Other noncurrent liabilities		3,713			3,705
Noncurrent liabilities of discontinued operations and held for sale businesses		3			17
Total noncurrent liabilities		25,613			25,919
Contingencies and Commitments (see Note 8)
Cumulative preferred stock of subsidiaries		78			78
EQUITY
THE AES CORPORATION STOCKHOLDERS’ EQUITY
Common stock ($0.01 par value, 1,200,000,000 shares authorized; 812,021,363 issued and 746,474,449 outstanding at March 31, 2013 and 810,679,839 issued and 744,263,855 outstanding at December 31, 2012)		8			8
Additional paid-in capital		8,527			8,525
Accumulated deficit		(182	)		(264	)
Accumulated other comprehensive loss		(2,952	)		(2,920	)
Treasury stock, at cost (65,546,914 shares at March 31, 2013 and 66,415,984 shares at December 31, 2012)		(768	)		(780	)
Total AES Corporation stockholders’ equity		4,633			4,569
NONCONTROLLING INTERESTS		3,108			2,945
Total equity		7,741			7,514
TOTAL LIABILITIES AND EQUITY	$	42,718		$	41,830

See Notes to Condensed Consolidated Financial Statements

1

THE AES CORPORATION

Condensed Consolidated Statements of Operations

(Unaudited)

	Three Months Ended March 31,
	2013			2012
	(in millions, except per share amounts)
Revenue:
Regulated	$	2,246		$	2,484
Non-Regulated		2,019			2,102
Total revenue		4,265			4,586
Cost of Sales:
Regulated		(1,894	)		(2,056	)
Non-Regulated		(1,616	)		(1,458	)
Total cost of sales		(3,510	)		(3,514	)
Gross margin		755			1,072
General and administrative expenses		(61	)		(87	)
Interest expense		(377	)		(416	)
Interest income		66			91
Other expense		(75	)		(28	)
Other income		68			18
Gain on sale of investments		3			179
Asset impairment expense		(48	)		(10	)
Foreign currency transaction losses		(32	)		(1	)
Other non-operating expense		-			(49	)
INCOME FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN EARNINGS OF AFFILIATES		299			769
Income tax expense		(82	)		(268	)
Net equity in earnings of affiliates		4			13
INCOME FROM CONTINUING OPERATIONS		221			514
Income from operations of discontinued businesses, net of income tax (benefit) expense of $(1) and $2, respectively		14			6
Net loss from disposal and impairments of discontinued businesses, net of income tax (benefit) expense of $(1) and $0, respectively		(36	)		(5	)
NET INCOME		199			515
Noncontrolling interests:
Less: Income from continuing operations attributable to noncontrolling interests		(115	)		(173	)
Less: Income from discontinued operations attributable to noncontrolling interests		(2	)		(1	)
Total net income attributable to noncontrolling interests		(117	)		(174	)
NET INCOME ATTRIBUTABLE TO THE AES CORPORATION	$	82		$	341
AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:
Income from continuing operations, net of tax	$	106		$	341
Loss from discontinued operations, net of tax		(24	)		-
Net income	$	82		$	341
BASIC EARNINGS PER SHARE:
Income from continuing operations attributable to The AES Corporation common stockholders, net of tax	$	0.14		$	0.45
Loss from discontinued operations attributable to The AES Corporation common stockholders, net of tax		(0.03	)		-
NET INCOME ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS	$	0.11		$	0.45
DILUTED EARNINGS PER SHARE:
Income from continuing operations attributable to The AES Corporation common stockholders, net of tax	$	0.14		$	0.44
Loss from discontinued operations attributable to The AES Corporation common stockholders, net of tax		(0.03	)		-
NET INCOME ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS	$	0.11		$	0.44

See Notes to Condensed Consolidated Financial Statements

2

THE AES CORPORATION

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

	Three Months Ended March 31,
	2013			2012
	(in millions)
NET INCOME	$	199		$	515
Foreign currency translation activity:
Foreign currency translation adjustments, net of income tax (expense) benefit of $0 and $(1), respectively		(32	)		142
Reclassification to earnings, net of income tax (expense) benefit of $0 and $0, respectively		(3	)		(1	)
Total foreign currency translation adjustments		(35	)		141
Derivative activity:
Change in derivative fair value, net of income tax (expense) benefit of $0 and $(4), respectively		(16	)		21
Reclassification to earnings, net of income tax (expense) benefit of $(7) and $(28), respectively		24			86
Total change in fair value of derivatives		8			107
Pension activity:
Reclassification to earnings due to amortization of net actuarial loss, net of income tax (expense) benefit of $(7) and $(3), respectively		14			6
Total pension adjustments		14			6
OTHER COMPREHENSIVE INCOME (LOSS)		(13	)		254
COMPREHENSIVE INCOME		186			769
Less: Comprehensive income attributable to noncontrolling interests		(136	)		(245	)
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE AES CORPORATION	$	50		$	524

See Notes to Condensed Consolidated Financial Statements

3

THE AES CORPORATION

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Three Months Ended March 31,
	2013			2012
	(in millions)
OPERATING ACTIVITIES:
Net income	$	199		$	515
Adjustments to net income:
Depreciation and amortization		329			360
Gain from sale of investments and impairment expense		59			(92	)
Deferred income taxes		13			101
Provisions for contingencies		26			17
Loss on the extinguishment of debt		47			-
Loss on disposals and impairments - discontinued operations		38			-
Other		56			(40	)
Changes in operating assets and liabilities
(Increase) decrease in accounts receivable		42			(189	)
(Increase) decrease in inventory		(4	)		(11	)
(Increase) decrease in prepaid expenses and other current assets		(192	)		(117	)
(Increase) decrease in other assets		(45	)		(156	)
Increase (decrease) in accounts payable and other current liabilities		174			266
Increase (decrease) in income tax payables, net		(123	)		(161	)
Increase (decrease) in other liabilities		(1	)		41
Net cash provided by operating activities		618			534
INVESTING ACTIVITIES:
Capital expenditures		(546	)		(579	)
Proceeds from the sale of businesses, net of cash sold		1			63
Proceeds from the sale of assets		6			4
Sale of short-term investments		1,335			1,505
Purchase of short-term investments		(1,492	)		(1,855	)
(Increase) decrease in restricted cash		(35	)		28
(Increase) decrease in debt service reserves and other assets		(10	)		20
Proceeds from government grants for asset construction		1			85
Other investing		14			4
Net cash used in investing activities		(726	)		(725	)
FINANCING ACTIVITIES:
Borrowings (repayments) under the revolving credit facilities, net		15			(281	)
Issuance of non-recourse debt		1,491			503
Repayments of recourse debt		(2	)		(3	)
Repayments of non-recourse debt		(1,007	)		(151	)
Payments for financing fees		(33	)		(12	)
Distributions to noncontrolling interests		(31	)		(19	)
Contributions from noncontrolling interests		55			5
Dividends paid on AES common stock		(30	)		-
Financed capital expenditures		(7	)		(6	)
Other financing		4			1
Net cash provided by financing activities		455			37
Effect of exchange rate changes on cash		(8	)		25
(Increase) decrease in cash of discontinued and held for sale businesses		(4	)		99
Total increase (decrease) in cash and cash equivalents		335			(30	)
Cash and cash equivalents, beginning		1,966			1,688
Cash and cash equivalents, ending	$	2,301		$	1,658
SUPPLEMENTAL DISCLOSURES:
Cash payments for interest, net of amounts capitalized	$	234		$	291
Cash payments for income taxes, net of refunds	$	295		$	325

See Notes to Condensed Consolidated Financial Statements

4

THE AES CORPORATION

Notes to Condensed Consolidated Financial Statements

For the Three Months Ended March 31, 2013 and 2012

1. FINANCIAL STATEMENT PRESENTATION

The prior period condensed consolidated financial statements in this Quarterly Report on Form 10-Q (“Form 10-Q”) have been reclassified to reflect the businesses held for sale and discontinued operations as discussed in Note 15 — Discontinued Operations and Held for Sale Businesses.

Consolidation

In this Quarterly Report the terms “AES”, “the Company”, “us” or “we” refer to the consolidated entity including its subsidiaries and affiliates. The terms “The AES Corporation”, “the Parent” or “the Parent Company” refer only to the publicly-held holding company, The AES Corporation, excluding its subsidiaries and affiliates. Furthermore, variable interest entities (“VIEs”) in which the Company has a variable interest have been consolidated where the Company is the primary beneficiary. Investments in which the Company has the ability to exercise significant influence, but not control, are accounted for using the equity method of accounting. All intercompany transactions and balances have been eliminated in consolidation.

Interim Financial Presentation

The accompanying unaudited condensed consolidated financial statements and footnotes have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification, for interim financial information and Article 10 of Regulation S-X issued by the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by U.S. GAAP for annual fiscal reporting periods. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, comprehensive income and cash flows. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of results that may be expected for the year ending December 31, 2013. The accompanying condensed consolidated financial statements are unaudited and should be read in conjunction with the 2012 audited consolidated financial statements and notes thereto, which are included in the 2012 Form 10-K filed with the SEC on February 26, 2013 (the “2012 Form 10-K”).

Accounting Pronouncements Issued But Not Yet Effective

The following accounting standard has been issued, but is not yet effective for, and has not been adopted by AES.

ASU No. 2013-05, Foreign Currency Matters (Topic 830), “Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.”

In March 2013, the FASB issued ASU No. 2013-05, which requires an entity to release any related cumulative translation adjustment into net income when it ceases to have a controlling financial interest in a subsidiary or group of assets that is a business (other than a sale of in-substance real estate) within a foreign entity. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. For an equity method investment that is a foreign entity, the partial sale guidance still applies. As such, a pro rata portion of the cumulative translation adjustment should be released into net income upon a partial sale of such an equity method investment. In those instances, the cumulative translation

5

adjustment is released into net income only if the partial sale represents a complete or substantially complete liquidation of the foreign entity that contains the equity method investment. The amendments are effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU No. 2013-05 on the Company’s financial position, results of operations, and cash flows.

2. INVENTORY

The following table summarizes the Company’s inventory balances as of March 31, 2013 and December 31, 2012:

	March 31, 2013		December 31, 2012
	(in millions)
Coal, fuel oil and other raw materials	$	363	$	373
Spare parts and supplies		392		393
Total	$	755	$	766

3. FAIR VALUE

The fair value of current financial assets and liabilities, debt service reserves and other deposits approximate their reported carrying amounts. The estimated fair values of the Company’s assets and liabilities have been determined using available market information. By virtue of these amounts being estimates and based on hypothetical transactions to sell assets or transfer liabilities, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. There were no changes in fair valuation techniques during the period and the Company continues to follow the valuation techniques described in Note 4. — Fair Value in Item 8. — Financial Statements and Supplementary Data of its 2012 Form 10-K.

6

Recurring Measurements

The following table sets forth, by level within the fair value hierarchy, the Company’s financial assets and liabilities that were measured at fair value on a recurring basis as of March 31, 2013 and December 31, 2012:

	March 31, 2013								December 31, 2012
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(in millions)
Assets
AVAILABLE-FOR-SALE:(1)
Debt securities:
Unsecured debentures	$	-	$	615	$	-	$	615	$	-	$	448	$	-	$	448
Certificates of deposit		-		137		-		137		-		143		-		143
Government debt securities		-		28		-		28		-		34		-		34
Subtotal		-		780		-		780		-		625		-		625
Equity securities:
Mutual funds		-		57		-		57		-		56		-		56
Subtotal		-		57		-		57		-		56		-		56
Total available-for-sale		-		837		-		837		-		681		-		681
TRADING:
Equity securities:
Mutual funds		12		-		-		12		12		-		-		12
Total trading		12		-		-		12		12		-		-		12
DERIVATIVES:
Interest rate derivatives		-		2		-		2		-	$	2	$	-		2
Cross currency derivatives		-		8		-		8		-		6		-		6
Foreign currency derivatives		-		6		82		88		-		2		79		81
Commodity derivatives		-		6		1		7		-		8		3		11
Total derivatives		-		22		83		105		-		18		82		100
TOTAL ASSETS	$	12	$	859	$	83	$	954	$	12	$	699	$	82	$	793
Liabilities
DERIVATIVES:
Interest rate derivatives	$	-	$	469	$	72	$	541	$	-	$	153	$	412	$	565
Cross currency derivatives		-		3		-		3		-		6		-		6
Foreign currency derivatives		-		7		11		18		-		7		7		14
Commodity derivatives		-		24		69		93		-		13		59		72
Total derivatives		-		503		152		655		-		179		478		657
TOTAL LIABILITIES	$	-	$	503	$	152	$	655	$	-	$	179	$	478	$	657

⁽¹⁾  Amortized cost approximated fair value at March 31, 2013 and December 31, 2012. As of March 31, 2013, all available-for-sale debt securities had stated maturities within one year.

7

The following tables present a reconciliation of net derivative assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2013 and 2012 (presented net by type of derivative where any foreign currency impacts are presented as part of gains (losses) in earnings or other comprehensive income as appropriate). Transfers between Level 3 and Level 2 are determined as of the end of the reporting period and principally result from changes in significance of unobservable inputs used to calculate the credit valuation adjustment.

	Three Months Ended March 31, 2013
	Interest Rate			Foreign Currency			Commodity			Total
	(in millions)
Balance at January 1	$	(412	)	$	73		$	(57	)	$	(396	)
Total gains (losses) (realized and unrealized):
Included in earnings		-			(1	)		(10	)		(11	)
Included in other comprehensive income		(17	)		-			-			(17	)
Included in regulatory (assets) liabilities		-			-			(1	)		(1	)
Settlements		23			(1	)		-			22
Transfers of (assets) liabilities out of Level 3		334			-			-			334
Balance at March 31	$	(72	)	$	71		$	(68	)	$	(69	)
Total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities held at the end of the period	$	-		$	(2	)	$	(10	)	$	(12	)

	Three Months Ended March 31, 2012
	Interest Rate			Cross Currency			Foreign Currency			Commodity			Total
	(in millions)
Balance at January 1	$	(128	)	$	(18	)	$	51		$	(53	)	$	(148	)
Total gains (losses) (realized and unrealized):
Included in earnings		(1	)		-			(2	)		8			5
Included in other comprehensive income		1			14			-			-			15
Included in regulatory (assets) liabilities		-			-			-			-			-
Settlements		6			4			(1	)		(1	)		8
Transfers of assets (liabilities) into Level 3		(28	)		-			-			-			(28	)
Transfers of (assets) liabilities out of Level 3		26			-			-			-			26
Balance at March 31	$	(124)		$	-		$	48		$	(46	)	$	(122	)
Total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities held at the end of the period	$	-		$	-		$	(3	)	$	9		$	6

8

The following table summarizes the significant unobservable inputs used for the Level 3 derivative assets (liabilities) at March 31, 2013:

Type of Derivative	Fair Value			Unobservable Input	Amount or Range (Weighted Average)
	(in millions)
Interest rate	$	(72	)	Subsidiaries’ credit spreads		2.15% - 9.03%(4.35%)
Foreign currency:
Embedded derivative — Argentine Peso		70		Argentine Peso to U.S. Dollar currency exchange rate after 3 years		14.4 - 21.2(17.7)
Commodity:
Embedded derivative —
Aluminum		(65	)	Market price of power for customer in Cameroon (per KWh)		$0.06 - $0.14($0.12)
Other		(2	)
Total	$	(69	)

Nonrecurring Measurements

For purposes of impairment evaluation, the Company measured the fair value of long-lived assets and equity method investments under the fair value measurement accounting guidance. Impairment expense is measured by comparing the fair value of asset groups at the evaluation date to their carrying amount. The following table summarizes major categories of assets and liabilities measured at fair value on a nonrecurring basis during the period and their level within the fair value hierarchy:

	Three Months Ended March 31, 2013
	Carrying Amount		Fair Value						Gross Loss
			Level 1		Level 2		Level 3
	(in millions)
Assets
Long-lived assets held and used:(1)
Beaver Valley	$	61	$	-	$	-	$	15	$	46
Long-lived assets held for sale:(1)
Wind turbines		25		-		-		25		-
Discontinued operations and held for sale businesses:(2)
Ukraine utilities		143		-		109		-		38

	Three Months Ended March 31, 2012
	Carrying Amount		Fair Value						Gross Loss
			Level 1		Level 2		Level 3
	(in millions)
Assets
Long-lived assets held and used:(1)
Kelanitissa		22		-		-		17		5
Equity method investments(3)		204		-		155		-		49

⁽¹⁾ See Note 13 — Asset Impairment Expense for further information.

⁽²⁾ See Note 15 — Discontinued Operations and Held For Sale Businesses for further information. Also, the gross loss equals the carrying amount of the disposal group less its fair value less costs to sell.

⁽³⁾ See Note 14 — Other Non-Operating Expense for further information.

9

The following table summarizes the significant unobservable inputs used in the Level 3 measurement of long-lived assets during the three months ended March 31, 2013:

	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted  Average)
	(in millions)				($ in millions)
Long-lived assets held and used:
Beaver Valley	$	15	Discounted cash flow	Annual revenue growth		3% to 45% (19%)
				Annual pretax operating margin		-42% to 41% (25%)
				Weighted average cost of capital		7%
Long-lived assets held for sale:
Wind turbines		25	Market Approach	Indicative offer prices		$12 to $38 ($25)
Total	$	40

Financial Instruments not Measured at Fair Value in the Condensed Consolidated Balance Sheets

The following table sets forth the carrying amount, fair value and fair value hierarchy of the Company’s financial assets and liabilities that are not measured at fair value in the condensed consolidated balance sheets as of March 31, 2013 and December 31, 2012, but for which fair value is disclosed.

	Carrying Amount		Fair Value
			Total		Level 1		Level 2		Level 3
	(in millions)
March 31, 2013
Assets
Accounts receivable — noncurrent(1)	$	295	$	167	$	-	$	-	$	167
Liabilities
Non-recourse debt		15,923		16,416		-		14,212		2,204
Recourse debt		5,961		6,724		-		6,724		-
December 31, 2012
Assets
Accounts receivable — noncurrent(1)	$	304	$	188	$	-	$	-	$	188
Liabilities
Non-recourse debt		15,383		16,110		-		13,811		2,299
Recourse debt		5,962		6,628		-		6,628		-

⁽¹⁾ These accounts receivable principally relate to amounts due from the independent system operator in Argentina and are included in “Noncurrent assets — Other” in the accompanying condensed consolidated balance sheets. The fair value of these accounts receivable excludes value added tax of $53 million and $55 million at March 31, 2013 and December 31, 2012, respectively.

4. INVESTMENTS IN MARKETABLE SECURITIES

The Company’s investments in marketable debt and equity securities as of March 31, 2013 and December 31, 2012 by security class and by level within the fair value hierarchy have been disclosed in Note 3 — Fair Value. The security classes are determined based on the nature and risk of a security and are consistent with how the Company manages, monitors and measures its marketable securities. As of March 31, 2013, all available-for-sale debt securities had stated maturities within one year.

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The following table summarizes the pre-tax gains and losses related to available-for-sale and trading securities for the three months ended March 31, 2013 and 2012. Gains and losses on the sale of investments are determined using the specific identification method. For the three months ended March 31, 2013 and 2012, there were no realized losses on the sale of available-for-sale securities and no other-than-temporary impairment of marketable securities recognized in earnings or other comprehensive income.

	2013		2012
	(in millions)
Gains included in earnings that relate to trading securities held at the reporting date	$	1	$	-
Gross proceeds from sales of available-for-sale securities		1,704		1,523
Gross realized gains on sales		-		1

5. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

There have been no changes to the information disclosed under “Derivatives and Hedging Activities” in Note 1 — General and Summary of Significant Accounting Policies to Item 8. — Financial Statements and Supplementary Data in the 2012 Form 10-K.

Volume of Activity

The following tables set forth, by type of derivative, the Company’s outstanding notional under its derivatives and the weighted average remaining term as of March 31, 2013 regardless of whether the derivative instruments are in qualifying cash flow hedging relationships:

	March 31, 2013
	Current				Maximum
Interest Rate and Cross Currency	Derivative Notional		Derivative Notional Translated to USD		Derivative Notional		Derivative Notional Translated to USD		Weighted Average Remaining Term		% of Debt Currently Hedged by Index(2)
	(in millions)								(in years)
Interest Rate Derivatives:(1)
LIBOR (U.S. Dollar)		3,451	$	3,451		4,226	$	4,226		9		70	%
EURIBOR (Euro)		605		776		605		776		9		67	%
LIBOR (British Pound)		69		105		69		105		13		83	%
Cross Currency Swaps:
Chilean Unidad de Fomento		6		271		6		271		9		85	%

⁽¹⁾  The Company’s interest rate derivative instruments primarily include accreting and amortizing notionals. The maximum derivative notional represents the largest notional at any point between March 31, 2013 and the maturity of the derivative instrument, which includes forward starting derivative instruments. The interest rate and cross currency derivatives range in maturity through 2030 and 2028, respectively.

⁽²⁾  The percentage of variable-rate debt currently hedged is based on the related index and excludes forecasted issuances of debt and variable-rate debt tied to other indices where the Company has no interest rate derivatives.

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	March 31, 2013
Foreign Currency Derivatives	Notional(1)		Notional Translated to USD		Weighted Average Remaining Term(2)
	(in millions)				(in years)
Foreign Currency Options and Forwards:
Chilean Peso		80,558	$	166		<1
Brazilian Real		240		118		<1
Euro		29		41		<1
Colombian Peso		53,208		28		<1
Argentine Peso		83		14		<1
British Pound		3		5		<1
Embedded Foreign Currency Derivatives
Argentine Peso		829		169		11
Kazakhstani Tenge		1,009		7		5
Euro		2		2		10

⁽¹⁾  Represents contractual notionals. The notionals for options have not been probability adjusted, which generally would decrease them.

⁽²⁾  Represents the remaining tenor of our foreign currency derivatives weighted by the corresponding notional. These options and forwards and these embedded derivatives range in maturity through 2014 and 2026, respectively.

	March 31, 2013
Commodity Derivatives	Notional		Weighted Average Remaining Term(1)
	(in millions)		(in years)
Aluminum (MWh)(2)		14		7
Power (MWh)		6		3

⁽¹⁾  Represents the remaining tenor of our commodity derivatives weighted by the corresponding volume. These derivatives range in maturity through 2019.

⁽²⁾  Our exposure is to fluctuations in the price of aluminum while the notional is based on the amount of power we sell under the PPA.

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Accounting and Reporting

Assets and Liabilities

The following tables set forth the Company’s derivative instruments as of March 31, 2013 and December 31, 2012, first by whether or not they are designated hedging instruments, then by whether they are current or non-current, by the extent to which they are subject to master netting agreements or similar agreements (where the rights to set off relate to settlement of amounts receivable and payable under those derivatives) and by balances no longer accounted for as derivatives.

	March 31, 2013						December 31, 2012
	Designated		Not Designated		Total		Designated		Not Designated		Total
	(in millions)						(in millions)
Assets
Interest rate derivatives	$	-	$	2	$	2	$	-	$	2		2
Cross currency derivatives		8		-		8		6		-		6
Foreign currency derivatives		1		87		88		-		81		81
Commodity derivatives		-		7		7		2		9		11
Total assets	$	9	$	96	$	105	$	8	$	92	$	100
Liabilities
Interest rate derivatives	$	523	$	18	$	541	$	544	$	21		565
Cross currency derivatives		3		-		3		6		-		6
Foreign currency derivatives		7		11		18		7		7		14
Commodity derivatives		11		82		93		8		64		72
Total liabilities	$	544	$	111	$	655	$	565	$	92	$	657

	March 31, 2013						December 31, 2012
	Assets			Liabilities			Assets			Liabilities
	(in millions)						(in millions)
Current	$	18		$	175		$	14		$	186
Noncurrent		87			480			86			471
Total	$	105		$	655		$	100		$	657
Derivatives subject to master netting agreement or similar agreement:
Gross (which equals net) amounts recognized in the balance sheet	$	19		$	520		$	25		$	522
Gross amounts of derivative instruments not offset		(8	)		(8	)		(9	)		(9	)
Gross amounts of cash collateral received/pledged not offset		-			(14	)		-			(5	)
Net amount	$	11		$	498		$	16		$	508
Other balances that had been, but no longer need to be, accounted for as derivatives at fair value that are to be amortized to earnings over the remaining term of the associated PPA	$	181		$	191		$	186		$	191

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Effective Portion of Cash Flow Hedges

The following tables set forth the pre-tax gains (losses) recognized in accumulated other comprehensive loss (“AOCL”) and earnings related to the effective portion of derivative instruments in qualifying cash flow hedging relationships (including amounts that were reclassified from AOCL as interest expense related to interest rate derivative instruments that previously, but no longer, qualify for cash flow hedge accounting), as defined in the accounting standards for derivatives and hedging, for the three months ended March 31, 2013 and 2012:

	Gains (Losses) Recognized in AOCL						Classification in Condensed Consolidated Statements of Operations	Gains (Losses)  Reclassified from AOCL into Earnings
Type of Derivative	2013			2012				2013			2012
	(in millions)							(in millions)
Interest rate derivatives	$	(13	)	$	11		Interest expense	$	(32	)	$	(32	)
							Non-regulated cost of sales		(1	)		(2	)
							Net equity in earnings of affiliates		(2	)		(1	)
							Gain on sale of investments		-			(92	)
Cross currency derivatives		1			14		Interest expense		(3	)		(3	)
							Foreign currency transaction gains (losses)		5			18
Foreign currency derivatives		1			6		Foreign currency transaction gains (losses)		2			-
Commodity derivatives		(5	)		(6	)	Non-regulated revenue		-			(2	)
Total	$	(16	)	$	25			$	(31	)	$	(114	)

The pre-tax accumulated other comprehensive income (loss) expected to be recognized as an increase (decrease) to income from continuing operations before income taxes over the next twelve months as of March 31, 2013 is $(146) million for interest rate hedges, $(11) million for cross currency swaps, $(6) million for foreign currency hedges, and $(9) million for commodity and other hedges.

Ineffective Portion of Cash Flow Hedges

The following table sets forth the pre-tax gains (losses) recognized in earnings related to the ineffective portion of derivative instruments in qualifying cash flow hedging relationships, as defined in the accounting standards for derivatives and hedging, for the three months ended March 31, 2013 and 2012:

	Classification in Condensed Consolidated Statements of Operations	Gains (Losses) Recognized in Earnings
Type of Derivative		2013			2012
		(in millions)
Interest rate derivatives	Interest expense	$	(1	)	$	(1	)
Total		$	(1	)	$	(1	)

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Not Designated for Hedge Accounting

The following table sets forth the gains (losses) recognized in earnings related to derivative instruments not designated as hedging instruments under the accounting standards for derivatives and hedging and the amortization of balances that had been, but no longer need to be, accounted for as derivatives at fair value, for the three months ended March 31, 2013 and 2012:

	Classification in Condensed Consolidated Statements of Operations	Gains (Losses) Recognized in Earnings
Type of Derivative		2013			2012
		(in millions)
Interest rate derivatives	Interest expense	$	1		$	(2	)
	Net equity in earnings of affiliates		(6	)		-
Foreign currency derivatives	Foreign currency transaction gains (losses)		6			(38	)
	Net equity in earnings of affiliates		(3	)		-
Commodity and other derivatives	Non-regulated revenue		(21	)		14
	Regulated revenue		(3	)		(4	)
	Non-regulated cost of sales		1			3
	Regulated cost of sales		-			(4	)
Total		$	(25	)	$	(31	)

Credit Risk-Related Contingent Features

DP&L, our utility in Ohio, has certain over-the-counter commodity derivative contracts under master netting agreements that contain provisions that require DP&L to maintain an investment-grade issuer credit rating from credit rating agencies. Since their rating has fallen below investment grade, certain of the counterparties to the derivative contracts have requested immediate and ongoing full overnight collateralization of the mark-to-market loss (fair value excluding credit valuation adjustments), which was $23 million and $13 million as of March 31, 2013 and December 31, 2012, respectively, for all derivatives with credit risk-related contingent features. As of March 31, 2013 and December 31, 2012, DP&L had posted $14 million and $5 million, respectively, of cash collateral directly with third parties and in a broker margin account and DP&L held $0 million and $0 million of cash collateral that it received from counterparties to its derivative instruments that were in an asset position. After consideration of the netting of counterparty assets, DP&L could have been required to provide additional collateral of $5 million and $2 million as of March 31, 2013 and December 31, 2012.

6. LONG-TERM FINANCING RECEIVABLES

Long-term financing receivables represent receivables from certain Latin American governmental bodies, primarily in Argentina, that have contractual maturities of greater than one year pursuant to amended agreements or government resolutions. These financing receivables are included in “Noncurrent assets — other” in the Condensed Consolidated Balance Sheets.

Argentina — As a result of energy market reforms in 2004 and consistent with contractual arrangements, our subsidiaries entered into three agreements with the Argentine government called Fondos de inversion Mercado Electrico Mayorista (“Foninvemem Agreements”) to contribute a portion of their accounts receivable into a fund for financing the construction of combined cycle and gas-fired plants. These financing receivables accrue interest and are collected in monthly installments over 10 years once the related plant begins operations. In addition, the Company also receives an ownership interest in these newly built plants once the receivables have been fully repaid. The financing receivables under the first two Foninvemem Agreements are being actively collected since the related plants commenced operations in 2010. However, the financing receivables related to the third Foninvemem Agreement are not currently due as commercial operations of the related gas-fired turbine

15

have not been achieved. Collection of these financing receivables is subject to various business risks and uncertainties including timely payment of principal and interest, completion and operation of power plants which generate cash for payments of these receivables, regulatory changes that could impact the timing and amount of collections and economic conditions in Argentina. The Company periodically analyzes each of these factors and assesses collectability of the related financing receivables. The Company’s collection estimates are based on assumptions that it believes to be reasonable but are inherently uncertain. Actual future cash flows could differ from these estimates.

Additionally, our subsidiaries are currently working with the Argentine government to include outstanding receivables of $122 million covered under government resolutions into the third Foninvemem Agreement. On March 26, 2013, the Argentine government passed a resolution to develop a new energy regulatory framework that would apply to all generation companies with certain exceptions. However, as of March 31, 2013 the resolution was not legally binding for our subsidiaries given that certain conditions precedent had not been met. The new regulatory framework will remunerate fixed and variable costs plus a margin that will depend on both the technology and fuel used to generate the electricity. The Company is currently analyzing the impact that this resolution will have on its subsidiaries in future periods, once it is effective.

The following table sets forth the breakdown of financing receivables by country as of March 31, 2013 and December 31, 2012. The decrease in the long-term financing receivables from December 31, 2012 is primarily related to the impact of foreign currency translation.

	March 31, 2013		December 31, 2012
	(in millions)
Argentina(1)	$	187	$	196
Dominican Republic		31		35
Brazil		8		8
Total long-term financing receivables	$	226	$	239

⁽¹⁾  Excludes noncurrent receivables of $122 million and $120 million, respectively, as of March 31, 2013 and December 31, 2012, which have not been converted into long-term financing receivables and currently have no due date.

7. NON-RECOURSE DEBT

Significant transactions

During the three months ended March 31, 2013, we had the following significant debt transactions at our subsidiaries:

• Tietê issued new debt of $251 million partially offset by repayments of $60 million;

• El Salvador issued new debt of $310 million partially offset by repayments of $150 million;

• Sul issued new debt of $150 million partially offset by repayments of $34 million;

• Mong Duong drew $119 million under its construction loan facility; and

• Masinloc refinanced its senior debt facility of $500 million and incurred a loss on extinguishment of debt of $43 million. See Note 12—Other Income and Expense for further information.

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Debt in default

The following table summarizes the Company’s subsidiary non-recourse debt in default or accelerated as of March 31, 2013 and is classified as current non-recourse debt unless otherwise indicated:

	Primary Nature of  Default	March 31, 2013
Subsidiary		Default Amount		Net Assets
		(in millions)
Maritza	Covenant	$	819	$	576
Sonel	Covenant		264		361
Kavarna	Covenant		196		82
Saurashtra	Covenant		25		15
Total		$	1,304

The above defaults are not payment defaults, but are instead technical defaults triggered by failure to comply with other covenants and/or other conditions such as (but not limited to) failure to meet information covenants, complete construction or other milestones in an allocated time, meet certain minimum or maximum financial ratios, or other requirements contained in the non-recourse debt documents of the Company.

In addition, in the event that there is a default, bankruptcy or maturity acceleration at a subsidiary or group of subsidiaries that meets the applicable definition of materiality under the corporate debt agreements of The AES Corporation, there could be a cross-default to the Company’s recourse debt. At March 31, 2013 none of the defaults listed above individually or in the aggregate results in a cross-default under the recourse debt of the Company.

8. CONTINGENCIES AND COMMITMENTS

Guarantees, Letters of Credit and Commitments

In connection with certain project financing, acquisition, power purchase and other agreements, AES has expressly undertaken limited obligations and commitments, most of which will only be effective or will be terminated upon the occurrence of future events. In the normal course of business, AES has entered into various agreements, mainly guarantees and letters of credit, to provide financial or performance assurance to third parties on behalf of AES businesses. These agreements are entered into primarily to support or enhance the creditworthiness otherwise achieved by a business on a stand-alone basis, thereby facilitating the availability of sufficient credit to accomplish their intended business purposes. Most of the contingent obligations relate to future performance commitments which the Company or its businesses expect to fulfill within the normal course of business. The expiration dates of these guarantees vary from less than one year to more than 21 years.

The following table summarizes the Parent Company’s contingent contractual obligations as of March 31, 2013. Amounts presented in the table below represent the Parent Company’s current undiscounted exposure to guarantees and the range of maximum undiscounted potential exposure. The maximum exposure is not reduced by the amounts, if any, that could be recovered under the recourse or collateralization provisions in the guarantees. The amounts include obligations made by the Parent Company for the direct benefit of the lenders associated with the non-recourse debt of its businesses of $24 million.

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Contingent Contractual Obligations	Amount		Number of Agreements		Maximum Exposure Range for Each Agreement
	(in millions)				(in millions)
Guarantees and commitments	$	577		20	<$1 - $231
Cash collateralized letters of credit		254		13	<$1 - $169
Letters of credit under the senior secured credit facility		3		5	<$1 - $2
Total	$	834		38

During the three months ended March 31, 2013, the Company paid letter of credit fees ranging from 0.25% to 3.25% per annum on the outstanding amounts of letters of credit.

Environmental

The Company periodically reviews its obligations as they relate to compliance with environmental laws, including site restoration and remediation. As of March 31, 2013, the Company had recorded liabilities of $14 million for projected environmental remediation costs. Due to the uncertainties associated with environmental assessment and remediation activities, future costs of compliance or remediation could be higher or lower than the amount currently accrued. Based on currently available information and analysis, the Company believes that it is reasonably possible that costs associated with such liabilities, or as yet unknown liabilities, may exceed current reserves in amounts that could be material but cannot be estimated as of March 31, 2013.

Litigation

The Company is involved in certain claims, suits and legal proceedings in the normal course of business. The Company accrues for litigation and claims when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company has evaluated claims in accordance with the accounting guidance for contingencies that it deems both probable and reasonably estimable and, accordingly, has recorded aggregate reserves for all claims of approximately $345 million and $321 million as of March 31, 2013 and December 31, 2012, respectively. These reserves are reported on the condensed consolidated balance sheets within “accrued and other liabilities” and “other noncurrent liabilities.” A significant portion of the reserves relate to employment, non-income tax and customer disputes in international jurisdictions, principally Brazil. Certain of the Company’s subsidiaries, principally in Brazil, are defendants in a number of labor and employment lawsuits. The complaints generally seek unspecified monetary damages, injunctive relief, or other relief. The subsidiaries have denied any liability and intend to vigorously defend themselves in all of these proceedings. There can be no assurance that these reserves will be adequate to cover all existing and future claims or that we will have the liquidity to pay such claims as they arise.

The Company believes, based upon information it currently possesses and taking into account established reserves for liabilities and its insurance coverage, that the ultimate outcome of these proceedings and actions is unlikely to have a material effect on the Company’s consolidated financial statements. However, where no reserve has been recognized, it is reasonably possible that some matters could be decided unfavorably to the Company and could require the Company to pay damages or make expenditures in amounts that could be material but could not be estimated as of March 31, 2013. The material contingencies where a loss is reasonably possible primarily include: claims under financing agreements; disputes with offtakers, suppliers and EPC contractors; alleged violation of monopoly laws and regulations; income tax and non-income tax assessments by tax authorities; and environmental and regulatory matters. In aggregate, the Company estimates that the range of potential losses, where estimable, related to these reasonably possible material contingences to be between $944 million and $1.6 billion. The amounts considered reasonably possible do not include amounts reserved, as discussed above. These material contingencies do not include income tax related contingencies which are considered part of our uncertain tax positions.

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9. PENSION PLANS

Total pension cost for the three months ended March 31, 2013 and 2012 included the following components:

	Three Months Ended March 31,
	2013						2012
	U.S.			Foreign			U.S.			Foreign
	(in millions)
Service cost	$	4		$	7		$	4		$	7
Interest cost		11			139			12			141
Expected return on plan assets		(15	)		(130	)		(14	)		(122	)
Amortization of prior service cost		1			-			1			-
Amortization of net loss		7			21			6			10
Total pension cost	$	8		$	37		$	9		$	36

Total employer contributions for the three months ended March 31, 2013 for the Company’s U.S. and foreign subsidiaries were $50 million and $37 million, respectively. The expected remaining scheduled employer contributions for 2013 are $2 million and $132 million for U.S. and foreign subsidiaries, respectively.

10. EQUITY

Changes in Equity

The following table provides a reconciliation of the beginning and ending equity attributable to stockholders of The AES Corporation, noncontrolling interests and total equity as of March 31, 2013 and 2012:

	Three Months Ended March 31, 2013									Three Months Ended March 31, 2012
	The AES Corporation Stockholders’ Equity			Noncontrolling Interests			Total Equity			The AES Corporation Stockholders’ Equity		Noncontrolling Interests			Total Equity
	(in millions)									(in millions)
Balance at January 1	$	4,569		$	2,945		$	7,514		$	5,946	$	3,783		$	9,729
Net income		82			117			199			341		174			515
Total foreign currency translation adjustment, net of income tax		(42	)		7			(35	)		92		49			141
Total change in derivative fair value, net of income tax		7			1			8			90		17			107
Total pension adjustments, net of income tax		3			11			14			1		5			6
Capital contributions from noncontrolling interests		-			55			55			-		6			6
Distributions to noncontrolling interests		-			(27	)		(27	)		-		(14	)		(14	)
Disposition of businesses		-			-			-			-		(37	)		(37	)
Issuance and exercise of stock-based compensation benefit plans, net of income tax		14			-			14			19		-			19
Acquisition of subsidiary shares from noncontrolling interests		-			(1	)		(1	)		-		(1	)		(1	)
Balance at March 31	$	4,633		$	3,108		$	7,741		$	6,489	$	3,982		$	10,471

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Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss by component, net of tax and noncontrolling interests for the three months ended March 31, 2013 were as follows:

	Unrealized derivative losses, net			Unfunded pension obligations, net			Foreign currency translation adjustment, net			Total
	(in millions)
Balance at January 1	$	(481	)	$	(382	)	$	(2,057	)	$	(2,920	)
Other comprehensive income before reclassifications		(15	)		-			(39	)		(54	)
Amounts reclassified from accumulated other comprehensive loss		22			3			(3	)		22
Net current-period other comprehensive income		7			3			(42	)		(32	)
Balance at March 31	$	(474	)	$	(379	)	$	(2,099	)	$	(2,952	)

Reclassifications out of accumulated other comprehensive loss for the three months ended March 31, 2013 were as follows:

Details About Accumulated Other Comprehensive Loss Components	Affected Line Item in the Condensed Consolidated Statement of Operations	Three Months Ended March 31, 2013 (1)
		(in millions)
Unrealized derivative losses, net
	Interest expense	$	(35	)
	Foreign currency transaction gains (losses)		7
	Non-regulated cost of sales		(1	)
	Income from continuing operations before taxes and equity in earnings of affiliates		(29	)
	Income tax expense		7
	Net equity in earnings of affiliates		(2	)
	Income from continuing operations		(24	)
	Income from continuing operations attributable to noncontrolling interests		2
	Net income attributable to the AES Corporation	$	(22	)
Amortization of defined benefit pension actuarial loss, net
	Non-regulated cost of sales	$	(1	)
	Regulated cost of sales		(20	)
	Income from continuing operations before taxes and equity in earnings of affiliates		(21	)
	Income tax expense		7
	Income from continuing operations		(14	)
	Income from continuing operations attributable to noncontrolling interests		11
	Net income attributable to the AES Corporation	$	(3	)
Foreign currency translation adjustment, net
	Gain on sale of investment	$	3
	Net income attributable to the AES Corporation	$	3
Total reclassifications for the period, net of income tax and noncontrolling interests		$	(22	)

⁽¹⁾  Amounts in parentheses indicate debits to the condensed consolidated statement of operations.

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Dividend

The Company paid a dividend of $0.04 per outstanding share to its common stockholders on February 15, 2013.

Stock Repurchase Program

The Company’s Board of Directors has approved a stock repurchase program (the “Program”). The Program does not have an expiration date and it can be modified or terminated by the Company’s Board at any time. Under the Program, the Company may repurchase stock through a variety of methods, including open market repurchases and/or privately negotiated transactions. There can be no assurances as to the amount, timing or prices of repurchases, which may vary based on market conditions and other factors. As of March 31, 2013, $300 million was available under the Program.

There were no common stock repurchases under the Program during the three months ended March 31, 2013. The cumulative total purchases under the Program totaled 58,715,189 shares at a total cost of $680 million, which includes a nominal amount of commissions (average of $11.58 per share including commissions).

The common stock repurchased has been classified as treasury stock and accounted for using the cost method. A total of 65,546,914 and 66,415,984 shares were held as treasury stock at March 31, 2013 and December 31, 2012, respectively. Restricted stock units under the Company’s employee benefit plans are issued from treasury stock. The Company has not retired any common stock repurchased since it began the Program.

11. SEGMENTS

The segment reporting structure uses the Company’s management reporting structure as its foundation to reflect how the Company manages the business internally with further aggregation by geographic regions to provide better socio-political-economic understanding of our business. The management reporting structure is organized along six strategic business units (“SBUs”) — led by our Chief Operating Officer (“COO”), who in turn reports to our Chief Executive Officer (“CEO”). Upon the application of the accounting guidance for segment reporting, the Company has identified eight reportable segments based on the six strategic business units:

• US — Generation;

• US — Utilities;

• Andes — Generation;

• Brazil — Generation;

• Brazil — Utilities;

• MCAC — Generation;

• EMEA — Generation; and

• Asia — Generation.

Corporate and Other — The Company’s EMEA and MCAC Utilities operating segments are reported within “Corporate and Other” because they do not meet the criteria to allow for aggregation with another operating segment or the quantitative thresholds that would require separate disclosure under the segment

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reporting accounting guidance. None of these operating segments are currently material to our presentation of reportable segments, individually or in the aggregate. AES Solar and certain other unconsolidated businesses are accounted for using the equity method of accounting; therefore, their operating results are included in “Net Equity in Earnings of Affiliates” on the face of the Consolidated Statements of Operations, not in revenue or Adjusted pre-tax contribution (“Adjusted PTC”). “Corporate and Other” also includes corporate overhead costs which are not directly associated with the operations of our eight reportable segments and other intercompany charges such as self-insurance premiums which are fully eliminated in consolidation.

The Company uses Adjusted PTC as its primary segment performance measure. Adjusted PTC, a non-GAAP measure, is defined by the Company as pre-tax income from continuing operations attributable to AES excluding unrealized gains or losses related to derivative transactions, unrealized foreign currency gains or losses, gains or losses due to dispositions and acquisitions of business interests, losses due to impairments and costs due to the early retirement of debt. The Company has concluded that Adjusted PTC best reflects the underlying business performance of the Company and is the most relevant measure considered in the Company’s internal evaluation of the financial performance of its segments. Additionally, given its large number of businesses and complexity, the Company concluded that Adjusted PTC is a more transparent measure that better assists the investor in determining which businesses have the greatest impact on the overall Company results.

Total revenue includes inter-segment revenue related to the transfer of electricity from generation plants to utilities within Brazil. No material inter-segment revenue relationships exist between other segments. Corporate allocations include certain self-insurance activities which are reflected within segment adjusted PTC. All intra-segment activity has been eliminated with respect to revenue and adjusted PTC within the segment. Inter-segment activity has been eliminated within the total consolidated results. Asset information for businesses that were discontinued or classified as held for sale as of March 31, 2013 is segregated and is shown in the line “Discontinued Businesses” in the accompanying segment tables.

Information about the Company’s operations by segment for the three months ended March 31, 2013 and 2012 was as follows:

Revenue Three Months Ended March 31,	Total Revenue				Intersegment						External Revenue
	2013		2012		2013			2012			2013		2012
	(in millions)
US — Generation	$	170	$	198	$	-		$	-		$	170	$	198
US — Utilities		722		732		-			-			722		732
Andes — Generation		691		734		-			(9	)		691		725
Brazil — Generation		386		305		(280	)		(282	)		106		23
Brazil — Utilities		1,323		1,531		-			-			1,323		1,531
MCAC — Generation		458		393		(1	)		(1	)		457		392
EMEA — Generation		351		477		(8	)		(9	)		343		468
Asia — Generation		134		182		-			-			134		182
Corporate and Other		320		336		(1	)		(1	)		319		335
Total Revenue	$	4,555	$	4,888	$	(290	)	$	(302	)	$	4,265	$	4,586

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Adjusted Pre-Tax Contribution(1) Three Months Ended March 31,	Total Adjusted Pre-tax Contribution						Intersegment						External  Adjusted Pre-tax Contribution
	2013			2012			2013			2012			2013			2012
	(in millions)
US — Generation	$	65		$	36		$	2		$	11		$	67		$	47
US — Utilities		70			57			-			-			70			57
Andes — Generation		80			111			3			(5	)		83			106
Brazil — Generation		40			52			(67	)		(68	)		(27	)		(16	)
Brazil — Utilities		2			56			45			46			47			102
MCAC — Generation		48			71			3			2			51			73
EMEA — Generation		94			187			(2	)		(14	)		92			173
Asia — Generation		31			32			1			-			32			32
Corporate and Other		(165	)		(189	)		15			28			(150	)		(161	)
Total		265			413			-			-			265			413

Reconciliation to Income from Continuing Operations before Taxes and Equity earnings of Affiliates:
Non-GAAP Adjustments:
Unrealized derivative losses		(13	)		(30	)
Unrealized foreign currency gains (losses)		(27	)		29
Disposition/acquisition gains		3			178
Impairment losses		(48	)		(58	)
Debt retirement losses		(43	)		-
Pre-tax contribution		137			532
Add: income from continuing operations before taxes, attributable to noncontrolling interests		166			250
Less: Net equity in earnings of affiliates		4			13
Income from continuing operations before taxes and equity in earnings of affiliates	$	299		$	769

⁽¹⁾  Adjusted pre-tax contribution in each segment before intersegment eliminations includes the effect of intercompany transactions with other segments except for interest and charges for certain management fees.

Assets by segment as of March 31, 2013 and December 31, 2012 were as follows:

	Total Assets
	March 31, 2013		December 31, 2012
	(in millions)
Assets
US — Generation	$	3,184	$	3,259
US — Utilities		7,576		7,534
Andes — Generation		6,554		6,619
Brazil — Generation		1,867		1,590
Brazil — Utilities		8,424		8,120
MCAC — Generation		4,440		4,293
EMEA — Generation		4,568		4,578
Asia — Generation		2,702		2,625
Discontinued businesses		173		202
Corporate and Other & eliminations		3,230		3,010
Total assets	$	42,718	$	41,830

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12. OTHER INCOME AND EXPENSE

Other Income

Other income generally includes contract terminations, gains on asset sales and extinguishments of liabilities, favorable judgments on contingencies, and other income from miscellaneous transactions. The components of other income are summarized as follows:

	Three Months  Ended March 31,
	2013		2012
	(in millions)
Contract termination	$	60	$	-
Gain on sale of assets		1		2
Other		7		16
Total other income	$	68	$	18

Other income of $68 million for the three months ended March 31, 2013 was primarily due to the termination of the PPA at Beaver Valley.

Other income of $18 million for the three months ended March 31, 2012 was primarily due to the release of a reserve recorded against inventory at Ballylumford and the receipt of dividends from a cost method investment at Gener.

Other Expense

Other expense generally includes losses on asset sales, losses on extinguishment of debt, legal contingencies and losses from other miscellaneous transactions. The components of other expense are summarized as follows:

	Three Months  Ended March 31,
	2013		2012
	(in millions)
Loss on extinguishment of debt	$	47	$	-
Loss on sale and disposal of assets		15		24
Contract termination		7		-
Other		6		4
Total other expense	$	75	$	28

Other expense for the three months ended March 31, 2013 of $75 million was primarily due to the loss on the early extinguishment of debt at Masinloc, the loss on disposal of assets at Eletropaulo and the termination of a coal contract at Beaver Valley.

Other expense for the three months ended March 31, 2012 of $28 million was primarily due to losses on the disposal of assets at Eletropaulo.

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13. ASSET IMPAIRMENT EXPENSE

	Three Months Ended March 31,
	2013		2012
	(in millions)
Beaver Valley	$	46	$	-
Kelanitissa		-		5
Other		2		5
Total asset impairment expense	$	48	$	10

Beaver Valley — In January 2013, Beaver Valley, a wholly-owned 125 Megawatt (“MW”) coal-fired plant in Pennsylvania, entered into an agreement to early terminate its PPA with the offtaker in exchange for a lump sum payment of $60 million which was received on January 9, 2013. The termination was effective January 8, 2013. Beaver Valley also terminated its fuel supply agreement. Under the PPA termination agreement, annual capacity agreements between the offtaker and PJM Interconnection, LLC (“PJM”) (a regional transmission organization) for 2013 — 2016 have been assigned to Beaver Valley. The termination of the PPA resulted in a significant reduction in the future cash flows of the asset group and was considered an impairment indicator. The carrying amount of the asset group was not recoverable. The carrying amount of the asset group exceeded the fair value of the asset group, resulting in an asset impairment expense of $46 million. Beaver Valley is reported in the US Generation segment.

14. OTHER NON-OPERATING EXPENSE

There was no other non-operating expense for the three months ended March 31, 2013. Other non-operating expense for the three months ended March 31, 2012 consisted of the other-than-temporary impairment of the following equity method investments:

	Three Months Ended March 31,
	2012
	(in millions)
China generation	$	31
InnoVent		17
Other		1
Total other-non operating expense	$	49

China — During the first quarter of 2012, the Company concluded it was more likely than not that it would sell its interests in certain investments in China before the end of their joint venture terms. These investments include coal-fired, hydropower and wind generation facilities accounted for under the equity method of accounting. These were considered impairment indicators. In measuring the other-than-temporary impairment, the carrying value of $164 million of these investments was compared to their fair value of $133 million resulting in an other-than-temporary impairment expense of $31 million.

InnoVent — During the first quarter of 2012, the Company concluded it was more likely than not that it would sell its interest in InnoVent S.A.S. (“InnoVent”), an equity method investment in France with wind generation projects totaling 75 MW. InnoVent had a carrying value of $36 million which exceeded its fair value of $19 million, resulting in an other-than-temporary impairment expense of $17 million.

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15. DISCONTINUED OPERATIONS AND HELD FOR SALE BUSINESSES

In addition to the businesses reported as discontinued operations in the 2012 Form 10-K, discontinued operations include the results of the following businesses classified as held for sale in March of 2013:

• Ukraine Utilities businesses

The following table summarizes the revenue, income from operations, income tax expense, impairment and loss on disposal of all discontinued operations for the three months ended March 31, 2013 and 2012:

	Three Months Ended March 31,
	2013			2012
	(in millions)
Revenue	$	147		$	191
Income from operations of discontinued businesses, before income tax	$	13		$	8
Income tax benefit (expense)		1			(2	)
Income from operations of discontinued businesses, after income tax	$	14		$	6
Net loss from disposal and impairments of discontinued businesses, after income tax	$	(36	)	$	(5	)

Ukraine Utilities sale — On January 29, 2013, the Company agreed to sell its two power distribution businesses in Ukraine to VS Energy International. Under the agreement, the Company sold its 89.1% equity interest in AES Kyivoblenergo, which serves 881,000 customers in the Kiev region, and its 84.6% percent equity interest in AES Rivneoblenergo, which serves 412,000 customers in the Rivne region. The Company recognized an asset impairment of $38 million upon fair value measurement during the three months ended March 31, 2013. The transaction closed on April 29, 2013 and net proceeds of $109 million were received. These businesses were previously reported in “Corporate and Other.”

16. DISPOSITIONS

Cartagena — On February 9, 2012, a subsidiary of the Company completed the sale of 80% of its interest in the wholly-owned holding company of AES Energia Cartagena S.R.L. (“AES Cartagena”), a 1,199 MW gas-fired generation business in Spain. The Company owned approximately 70.81% of AES Cartagena through this holding company structure, as well as 100% of a related operations and maintenance company. During the first quarter of 2012, net proceeds from the sale of the 80% interest were approximately $229 million and the Company recognized a pretax gain of $178 million. Under the terms of the sale agreement, the buyer had an option to purchase the Company’s remaining 20% interest at a fixed price of $36 million during a five month period beginning March 2013. Of the total proceeds received in February 2012, approximately $9 million was deferred and allocated to the buyer’s option to purchase the Company’s remaining interest. The buyer exercised the option to purchase the Company’s remaining 20% interest in AES Cartagena on April 26, 2013. Net proceeds from the exercise of the option were approximately $24 million and the Company will recognize a pretax gain of $20 million in the second quarter of 2013.

Due to the Company’s continuing ownership interest extending beyond one year from the completion of the sale of its 80% interest, the prior period operating results of AES Cartagena were not reclassified as discontinued operations.

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17. EARNINGS PER SHARE

Basic and diluted earnings per share are based on the weighted average number of shares of common stock and potential common stock outstanding during the period. Potential common stock, for purposes of determining diluted earnings per share, includes the effects of dilutive restricted stock units, stock options and convertible securities. The effect of such potential common stock is computed using the treasury stock method or the if-converted method, as applicable.

The following tables present a reconciliation of the numerator and denominator of the basic and diluted earnings per share computation for income from continuing operations for the three months ended March 31, 2013 and 2012. In the table below, income represents the numerator and weighted-average shares represent the denominator:

	Three Months Ended March 31,
	2013						2012
	Income		Shares		$ per Share		Income		Shares		$ per Share
	(in millions except per share data)
BASIC EARNINGS PER SHARE
Income from continuing operations attributable to The AES Corporation common stockholders	$	106		745	$	0.14	$	341		766	$	0.45
EFFECT OF DILUTIVE SECURITIES
Convertible securities		-		-		-		6		15		-
Stock options		-		1		-		-		1		-
Restricted stock units		-		3		-		-		3		(0.01	)
DILUTED EARNINGS PER SHARE	$	106		749	$	0.14	$	347		785	$	0.44

The calculation of diluted earnings per share excluded 8 and 7 million options outstanding at March 31, 2013 and 2012, respectively, that could potentially dilute basic earnings per share in the future. These options were not included in the computation of diluted earnings per share because the exercise price of those options exceeded the average market price during the related period.

The calculation of diluted earnings per share also excluded 1 and 2 million restricted stock units outstanding at March 31, 2013 and 2012, respectively, that could potentially dilute basic earnings per share in the future. These restricted stock units were not included in the computation of diluted earnings per share because the average amount of compensation cost per share attributed to future service and not yet recognized exceeded the average market price during the related period and thus to include the restricted units would have been anti-dilutive.

For the three months ended March 31, 2013 all 15 million convertible debentures were omitted from the earnings per share calculation because they were anti-dilutive. For the three months ended March 31, 2012, all convertible debentures were included in the earnings per share calculation.

During the three months ended March 31, 2013, 1 million shares of common stock were issued under the Company’s profit sharing plan.

18. SUBSEQUENT EVENTS

Dividend — On April 18, 2013, the Company’s Board of Directors declared a dividend of $0.04 per outstanding share payable on May 15, 2013 to the shareholders of record at the close of business on May 1, 2013.

Cartagena — On April 26, 2013, the Company’s remaining 20% interest held in AES Cartagena was sold upon the exercise of the purchase option by the buyer. See Note 16 — Dispositions for further information.

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Ukraine Utilities Sale — The sale transaction of Ukraine utilities was closed on April 29, 2013. See Note 15 — Discontinued Operations and Held for Sale Businesses for further information.

Recourse Debt — On April 30, 2013, the Company issued $500 million aggregate principal amount of 4.875% senior notes due 2023 (the “Notes”). In connection with this offering, the Company has commenced the tender offers (the “Tender Offers”) to purchase for cash up to $800 million aggregate principal amount of four series of our outstanding senior notes, including any and all of our outstanding 7.75% senior notes due 2014 (the “2014 Notes”), of which $500 million are currently outstanding; up to $100 million of our outstanding 7.75% senior notes due 2015 (the “2015 Notes”), of which $500 million are currently outstanding; up to $100 million of our outstanding 9.75% senior notes due 2016 (the “2016 Notes”), of which $535 million are currently outstanding; and up to $100 million of our outstanding 8.00% senior notes due 2017 (the “2017 Notes” and, together with the 2014 Notes, the 2015 Notes and the 2016 Notes, the “Outstanding Notes”), of which $1,500 million are currently outstanding. We intend to use the net proceeds from this offering, as well as, if necessary, other available funds, to fund the Tender Offers and to pay certain related fees and expenses. If any net proceeds from this offering remain after completion of the Tender Offers, we intend to use such proceeds for general corporate purposes.

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ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In this Quarterly Report on Form 10-Q (“Form 10-Q”), the terms “AES,” “the Company,” “us,” or “we” refer to the consolidated entity and all of its subsidiaries and affiliates, collectively. The term “The AES Corporation” or “the Parent Company” refers only to the parent, publicly-held holding company, The AES Corporation, excluding its subsidiaries and affiliates.

The condensed consolidated financial statements included in Item 1. — Financial Statements of this Form 10-Q and the discussions contained herein should be read in conjunction with our 2012 Form 10-K.

FORWARD-LOOKING INFORMATION

The following discussion may contain forward-looking statements regarding us, our business, prospects and our results of operations that are subject to certain risks and uncertainties posed by many factors and events that could cause our actual business, prospects and results of operations to differ materially from those that may be anticipated by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those described in Item 1A. — Risk Factors of our 2012 Form 10-K. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. We undertake no obligation to revise any forward-looking statements in order to reflect events or circumstances that may subsequently arise. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the SEC that advise of the risks and factors that may affect our business.

Overview of Our Business

We are a diversified power generation and utility company organized into six market-oriented Strategic Business Units (“SBUs”): US (United States), Andes (Chile, Colombia, and Argentina), Brazil, MCAC (Mexico, Central America and the Caribbean), EMEA (Europe, Middle East and Africa), and Asia. For additional information regarding our business, see Item 1. — Business of our 2012 Form 10-K.

Our Organization — The management reporting structure is organized along six SBUs led by our Chief Operating Officer (“COO”), who in turn reports to our Chief Executive Officer (“CEO”). Our CEO and COO are based in Arlington, Virginia. For financial reporting purposes, the Company has identified eight reportable segments based on the six SBUs. Accordingly, management’s discussion and analysis of revenue and gross margin is organized as follows:

• US SBU

• US — Generation segment

• US — Utilities segment

• Andes SBU

• Andes — Generation segment

• Brazil SBU

• Brazil — Generation segment

• Brazil — Utilities segment

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• MCAC SBU

• MCAC — Generation segment

• EMEA SBU

• EMEA — Generation segment

• Asia SBU

• Asia — Generation segment

Corporate and Other — The Company’s EMEA and MCAC utilities as well as Corporate are reported within “Corporate and Other” because they do not require separate disclosure under segment reporting accounting guidance. See Note 11 — Segments included in Item 1. — Financial Statements for further discussion of the Company’s segment structure used for financial reporting purposes.

Management’s Priorities

Management is focused on the following priorities:

• Management of our portfolio of generation and utility businesses to create value for our stakeholders, including customers and shareholders, through safe, reliable, and sustainable operations and effective cost management;

• Driving our operating business to manage capital more effectively and to increase the amount of discretionary cash available for deployment into debt repayment, growth investments, shareholder dividends and share buybacks;

• Realignment of our geographic focus. To this end, we will continue to exit markets where we do not have a competitive advantage or where we are unable to earn a fair risk-adjusted return relative to monetization alternatives. In addition, we will focus our growth investments on platform expansions or opportunities to expand our existing operations; and

• Reduce the cash flow and earnings volatility of our businesses by proactively managing our currency, commodity and political risk exposures, mostly through contractual and regulatory mechanisms, as well as commercial hedging activities. We also will continue to limit our risk by utilizing non-recourse project financing for the majority of our businesses.

Q1 2013 Performance

During the first quarter of 2013, Adjusted EPS declined $0.11 to $0.26. This decline was anticipated and was primarily driven by a one-time arbitration settlement at Cartagena in Spain recorded in the first quarter of 2012, the impact of low hydrology in Panama and Brazil, and unfavorable movements in foreign currency exchange rates, predominantly the Brazilian Real.

We continued to execute on our strategic objectives of safe, reliable and sustainable operations, improvement of available capital and deployment of discretionary cash and realignment of our geographic focus. Key highlights of our progress during the first quarter include:

Safe, Reliable and Sustainable Operations.

During the first quarter of 2013, we commenced commercial operations at our 270 MW coal-fired Ventanas IV plant in Chile. To supplement our future growth, we commenced construction of our 532 MW coal-fired Cochrane platform expansion project in Chile. This brings our total projects under construction to 2,443 MW, expected to come on-line 2013-2016.

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Improving Available Capital and Deployment of Discretionary Cash.

Building on actions that commenced in 2012, during the first quarter 2013, we deployed our discretionary cash to pay a dividend of $0.04 per share and invested $75 million in our subsidiaries to expand our existing facilities. Additionally, in April 2013, we initiated certain transactions to reduce debt and extend near-term maturities at the Parent Company. For further details please see Note 18 — Subsequent Events.

Realigning Our Geographic Focus.

Continuing on our efforts to further streamline our portfolio, we announced or closed the sale of three assets, for a total of $133 million in equity proceeds to AES, exiting our operations in Spain and the Ukraine.

Earnings Per Share Results in Q1 2013

	Three Months Ended March 31,
	2013		2012
Diluted earnings per share from continuing operations	$	0.14	$	0.44
Adjusted earnings per share (a non-GAAP measure)(1)	$	0.26	$	0.37

⁽¹⁾  See reconciliation and definition under Non-GAAP Measures.

During the three months ended March 31, 2013, diluted earnings per share from continuing operations decreased principally due to lower gross margin and a decrease in the gain on sale of investments resulting from the sale of 80% of our interest in Cartagena in the first quarter of 2012, as well as the other drivers described below in other operating highlights.

Adjusted earnings per share, a non-GAAP measure, decreased by 30% primarily due to lower gross margin, partially offset by higher other income due to the PPA termination at Beaver Valley.

Other Operating Highlights

	Three Months Ended March 31,
	2013		2012		% Change
	(in millions)
Revenue	$	4,265	$	4,586		-7	%
Gross margin	$	755	$	1,072		-30	%
Net income attributable to The AES Corporation	$	82	$	341		-76	%
Adjusted pre-tax contribution (a non-GAAP measure)(1)	$	265	$	413		-36	%
Net cash provided by operating activities	$	618	$	534		16	%

⁽¹⁾  See reconciliation and definition below under Non-GAAP Measures.

The following briefly describes the key changes in our reported revenue, gross margin, net income attributable to The AES Corporation, net cash provided by operating activities, diluted earnings per share from continuing operations and adjusted earnings per share (a non-GAAP measure) for the three months ended March 31, 2012 and 2011 and should be read in conjunction with our Consolidated Results of Operations and Segment Analysis discussion within Management’s Discussion and Analysis of Financial Condition below.

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Three months ended March 31, 2013:

Revenue decreased $321 million, or 7%, to $4.3 billion in the three months ended March 31, 2013 compared with $4.6 billion in the three months ended March 31, 2012. Excluding the impact of foreign currency of $239 million, the key drivers of the change at each of the SBU’s are as follows:

• US — Overall unfavorable impact of $38 million due to lower capacity revenue and lower average retail and average wholesale prices at DPL in Ohio, the impact of the PPA buyout at Beaver Valley in Pennsylvania, partially offset by higher wholesale volume at DPL and higher retail and wholesale volume at IPL in Indiana.

• Andes — Overall unfavorable impact of $16 million due to lower prices and volumes in Chile and impact of outage in Argentina during the first quarter of 2013 partially offset by higher prices in Colombia due to lower water inflows.

• Brazil — Overall favorable impact of $97 million due to the temporary restart of operations at Uruguaiana during February and March of 2013 and higher tariff at Eletropaulo compared to the 2012 tariff reset provision, partially offset by overall lower demand and lower volumes in our Brazil utilities.

• MCAC — Overall favorable impact of $71 million due to higher sales in the Dominican Republic, higher volume at Merida in Mexico and impact of tariff reset in El Salvador.

• EMEA — Overall unfavorable variance of $147 million due to the sale of 80% of our ownership and a non-recurring favorable arbitration settlement in Cartagena in the first quarter of 2012, lower capacity prices at Ballylumford in line with PPA beginning April 2012, and a mark-to-market loss on an embedded derivative at Sonel in Cameroon partially offset by lower outages in 2013.

• Asia — Overall unfavorable variance of $48 million due to lower volume in Sri Lanka, lower prices in the Philippines and the impact of a mark-to-market gain on a derivative in 2012 in the Philippines, partially offset by higher demand.

Gross margin decreased $317 million, or 30%, to $755 million in the three months ended March 31, 2013 compared with $1.1 billion in the three months ended March 31, 2012. Excluding the impact of foreign currency of $28 million, the key drivers of the change at each of the SBU’s are as follows:

• US — Overall unfavorable variance of $18 million driven by lower rates as discussed above at DPL and the PPA buyout at Beaver Valley, partially offset by lower amortization expense at DPL and higher retail and wholesale volume at IPL.

• Andes — Overall unfavorable impact of $30 million due to lower gas availability and coal generation in Chile, lower generation and prices in Argentina, partially offset by new operations of Ventanas IV in Chile.

• Brazil — Overall unfavorable impacts of $79 million due to lower water inflows in the system resulting in a higher allocation of energy purchases to Tietê partially offset by the temporary restart of operations at Uruguaiana as discussed above and lower volumes at Brazil utilities.

• MCAC — Overall unfavorable variance of $16 million due to higher purchased energy in Panama due to low hydrology, higher fuel costs and higher outages in Dominican Republic partially offset by higher volume in the Dominican Republic.

• EMEA — Overall unfavorable variance of $135 million due to the sale of 80% of our ownership and a non-recurring favorable arbitration settlement in Cartagena in the first quarter of 2012, lower capacity prices at Ballylumford, and a mark-to-market loss on an embedded derivative at Sonel in Cameroon, partially offset by lower outages in 2013.

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• Asia — Overall unfavorable impact of $12 million due to the impact of the mark-to-market gain on a derivative in 2012 and lower prices in the Philippines.

Net income attributable to The AES Corporation decreased $259 million to $82 million in the three months ended March 31, 2013 compared to $341 million in the three months ended March 31, 2012. The key drivers of the decrease included:

• the decrease in gross margin as described above;

• a decrease in gains on the sale of investments due to the prior year gain recorded on the sale of 80% of our interest in Cartagena in the first quarter of 2012;

• higher other expenses primarily due to the early extinguishment of debt at Masinloc;

• an increase in asset impairment expense due to impairment at Beaver Valley in Pennsylvania; and

• higher foreign currency transaction losses in 2013 compared to 2012.

These decreases were partially offset by:

• lower tax expense in the first quarter of 2013 due to lower income before tax and a decrease in the effective tax rate from 35% to 27%;

• higher other income primarily due to a gain arising from the termination of the PPA at Beaver Valley; and

• a decrease in other non-operating expense due to the prior year other-than-temporary impairment losses of equity method investments in China and France.

Net cash provided by operating activities increased $84 million, or 16%, to $618 million in the three months ended March 31, 2013 compared with $534 million in the three months ended March 31, 2012. This net increase was primarily the result of the following:

• US — an increase of $67 million at our generation businesses primarily due to proceeds of $60 million from the PPA termination at Beaver Valley in January 2013.

• Andes — a decrease of $59 million at our generation businesses primarily driven by income tax payments at Chivor.

• MCAC — an increase of $75 million at our generation businesses primarily due to the prepayment of gas in 2012 at Andres and higher collections and lower payments at Itabo.

Non-GAAP Measure

Adjusted pre-tax contribution (“adjusted PTC”) and Adjusted earnings per share (“adjusted EPS”) are non-GAAP supplemental measures that are used by management and external users of our consolidated financial statements such as investors, industry analysts and lenders.

We define adjusted PTC as pre-tax income from continuing operations attributable to AES excluding gains or losses of the consolidated entity due to (a) unrealized gains or losses related to derivative transactions, (b) unrealized foreign currency gains or losses, (c) gains or losses due to dispositions and acquisitions of business interests, (d) losses due to impairments, and (e) costs due to the early retirement of debt. Adjusted PTC also includes net equity in earnings of affiliates on an after-tax basis.

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We define adjusted EPS as diluted earnings per share from continuing operations excluding gains or losses of the consolidated entity due to (a) unrealized gains or losses related to derivative transactions, (b) unrealized foreign currency gains or losses, (c) gains or losses due to dispositions and acquisitions of business interests, (d) losses due to impairments, and (e) costs due to the early retirement of debt.

The GAAP measure most comparable to adjusted PTC is income from continuing operations attributable to AES. The GAAP measure most comparable to adjusted EPS is diluted earnings per share from continuing operations. We believe that adjusted PTC and adjusted EPS better reflect the underlying business performance of the Company and are considered in the Company’s internal evaluation of financial performance. Factors in this determination include the variability due to unrealized gains or losses related to derivative transactions, unrealized foreign currency gains or losses, losses due to impairments and strategic decisions to dispose of or acquire business interests or retire debt, which affect results in a given period or periods. In addition, for adjusted PTC, earnings before tax represents the business performance of the Company before the application of statutory income tax rates and tax adjustments, including the effects of tax planning, corresponding to the various jurisdictions in which the Company operates. Adjusted PTC and adjusted EPS should not be construed as alternatives to income from continuing operations attributable to AES and diluted earnings per share from continuing operations, which are determined in accordance with GAAP.

	Three Months Ended March  31, 2013						Three Months Ended March  31, 2012
	Net of NCI*			Per Share (Diluted) Net of NCI* and Tax			Net of NCI*			Per Share (Diluted) Net of NCI* and Tax
	(In millions, except per share amounts)
Income from continuing operations attributable to AES and Diluted EPS	$	106		$	0.14		$	341		$	0.44
Add back income tax expense from continuing operations attributable to AES		31						191
Pre-tax contribution		137						532
Adjustments
Unrealized derivative losses(1)		13			0.01			30			0.03
Unrealized foreign currency transaction (gains)/ losses(2)		27			0.02			(29	)		(0.02	)
Disposition/ acquisition (gains)		(3	)		-	(3)		(178	)		(0.14	)(4)
Impairment losses		48			0.05	(5)		58			0.06	(6)
Debt retirement losses		43			0.04	(7)		-			-
Adjusted pre-tax contribution and Adjusted EPS	$	265		$	0.26		$	413		$	0.37

* NCI is defined as Noncontrolling Interests

⁽¹⁾  Unrealized derivative losses were net of income tax per share of $0.01 and $0.01 in the three months ended March 31, 2013 and 2012, respectively.

⁽²⁾  Unrealized foreign currency transaction (gains)/losses were net of income tax per share of $0.01 and $(0.01) in the three months ended March 31, 2013 and 2012, respectively.

⁽³⁾  Amount primarily relates to the gain from the sale of Chengdu, an equity method investment in China for $3 million ($2 million, or $0.00 per share, net of income tax of $0.00 per share).

⁽⁴⁾  Amount primarily relates to the gain from the sale of 80% of our interest in Cartagena for $178 million ($107 million, or $0.14 per share, net of income tax of $0.09 per share).

⁽⁵⁾  Amount primarily relates to asset impairments at Beaver Valley of $46 million ($32 million, or $0.04 per share, net of income tax of $0.02 per share).

⁽⁶⁾  Amount primarily relates to the other-than-temporary impairment of equity method investments in China of $32 million ($26 million, or $0.03 per share, net of income tax of $0.01 per share), and at InnoVent of $17 million ($12 million, or $0.02 per share, net of income tax of $0.01 per share).

⁽⁷⁾  Amount primarily relates to the loss on early retirement of debt at Masinloc of $43 million ($28 million, or $0.04 per share, net of noncontrolling interest of $3 million and of income tax of $0.01 per share).

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Consolidated Results of Operations

	Three Months Ended March 31,
Results of operations	2013			2012			$ change			% change
	(in millions, except per share amounts)
Revenue:
US — Generation	$	170		$	198		$	(28	)	$	-14	%
US — Utilities		722			732			(10	)		-1	%
Andes — Generation		691			734			(43	)		-6	%
Brazil — Generation		386			305			81			27	%
Brazil — Utilities		1,323			1,531			(208	)		-14	%
MCAC — Generation		458			393			65			17	%
EMEA — Generation		351			477			(126	)		-26	%
Asia — Generation		134			182			(48	)		-26	%
Corporate and Other(1)		320			336			(16	)		-5	%
Intersegment eliminations(2)		(290	)		(302	)		12			4	%
Total Revenue	$	4,265		$	4,586		$	(321	)	$	-7	%
Gross Margin:
US — Generation	$	31		$	53		$	(22	)	$	-42	%
US — Utilities		118			114			4			4	%
Andes — Generation		134			167			(33	)		-20	%
Brazil — Generation		163			225			(62	)		-28	%
Brazil — Utilities		40			83			(43	)		-52	%
MCAC — Generation		87			105			(18	)		-17	%
EMEA — Generation		121			247			(126	)		-51	%
Asia — Generation		41			54			(13	)		-24	%
Corporate and Other(1)		7			23			(16	)		-70	%
Intersegment eliminations(2)		13			1			12			NM
General and administrative expenses		(61	)		(87	)		26			30	%
Interest expense		(377	)		(416	)		39			9	%
Interest income		66			91			(25	)		-27	%
Other expense		(75	)		(28	)		(47	)		-168	%
Other income		68			18			50			278	%
Gain on sale of investments		3			179			(176	)		-98	%
Asset impairment expense		(48	)		(10	)		(38	)		-380	%
Foreign currency transaction losses		(32	)		(1	)		(31	)		NM
Other non-operating expense		-			(49	)		49			100	%
Income tax expense		(82	)		(268	)		186			69	%
Net equity in earnings of affiliates		4			13			(9	)		-69	%
Income from continuing operations		221			514			(293	)		-57	%
Income from operations of discontinued businesses		14			6			8			133	%
Net loss from disposal and impairments of discontinued businesses		(36	)		(5	)		(31	)		-620	%
Net income		199			515			(316	)		-61	%
Noncontrolling interests:
Income from continuing operations attributable to noncontrolling interests		(115	)		(173	)		58			34	%
Income from discontinued operations attributable to noncontrolling interests		(2	)		(1	)		(1	)		-100	%
Net income attributable to The AES Corporation	$	82		$	341		$	(259	)	$	-76	%
AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:
Income from continuing operations, net of tax	$	106		$	341		$	(235	)	$	-69	%
Loss from discontinued operations, net of tax		(24	)		-			(24	)		N/A
Net income	$	82		$	341		$	(259	)	$	-76	%

35

NM — Not meaningful

⁽¹⁾  Corporate and other includes revenue and gross margin from our utility businesses in El Salvador and Africa.

⁽²⁾  Represents intersegment eliminations of revenue and gross margin primarily related to transfers of electricity from Tietê (Brazil — Generation) to Eletropaulo (Brazil — Utilities).

Key Trends and Uncertainties

During the remainder of 2013 and beyond, we expect to face the following challenges at certain of our businesses. Management expects that improved operating performance at certain businesses, growth from new businesses and global cost reduction initiatives may lessen or offset their impact. If these favorable effects do not occur, or if the challenges described below and elsewhere in this section impact us more significantly than we currently anticipate, or if volatile foreign currencies and commodities move more unfavorably, then these adverse factors (or other adverse factors unknown to us) may impact our gross margin, net income attributable to The AES Corporation and cash flows. We continue to monitor our operations and address challenges as they arise. For the risk factors related to our business, see Item 1. — Business and Item 1A. — Risk Factors of the 2012 Form 10-K.

Regulatory

Rate Case Proceedings

Two of our utility businesses, DP&L in the United States and AES Sul in Brazil, are in the process of their regulated tariff review and/or reset by the applicable regulatory agency. The tariff outcome will determine the amount that our utility businesses can charge to customers for electricity.

DP&L — On October 5, 2012, DP&L filed an Electric Security Plan (ESP) with the Public Utilities Commission of Ohio (“PUCO”) to establish Standard Service Offer (SSO) rates that were to be in effect starting January 1, 2013. The plan was refiled on December 12, 2012 to correct for certain projected costs. The plan requested approval of a non-bypassable charge that is designed to recover $138 million per year for five years from all customers. DP&L also requested approval of a switching tracker that would measure the incremental amount of switching over a base case and defer the lost value into a regulatory asset which would be recovered from all customers beginning January 2014. The ESP states that DP&L plans to file on or before December 31, 2013 its plan for legal separation of its generation assets. The ESP proposes a three year, five month transition to market, whereby a wholesale competitive bidding structure will be phased in to supply generation service to customers located in DP&L’s service territory that have not chosen an alternative generation supplier. As a result of this filing, DP&L’s overall SSO generation revenue is projected to decrease by approximately $46 million for the first year, due to a portion of DP&L’s SSO load being sourced through a competitive bid and other adjustments that were made to the SSO generation rates. As more SSO supply is sourced through a competitive bid, DP&L will continue to experience a decrease in SSO generation revenue each year throughout the blending period. DP&L’s retail transmission rates will increase as a retail, non-bypassable transmission charge will be implemented; however, this revenue will be offset slightly by a decrease in wholesale transmission revenue from Competitive Retail Electric Service Providers operating in DP&L’s service territory. An evidentiary hearing on this case was held March 18, 2013 through April 3, 2013. An order is expected to be issued by the PUCO late in the second quarter or early in the third quarter of 2013. The PUCO authorized that the rates being collected prior to December 31, 2012 would continue until the new ESP rates go into effect. See Item 1. — Business — US SBU Businesses — U.S. Utilities, DPL Inc. included in the 2012 Form 10-K for further information. In addition to the regulatory risks noted above, DP&L also faces a number of additional uncertainties related to the impact of customer switching and low power prices which could impact DP&L’s results of operations, its ability to refinance certain debt (or to do so on favorable terms) which is due in the near to intermediate term, and/or realize the benefits associated with the remaining goodwill. Any of the above-referenced conditions, events or factors could have a material impact on the Company or its results of operations.

36

Sul — On April 16, 2013, the Brazilian energy regulator (the “Regulator”) approved the periodic tariff reset of AES Sul which occurs every five years. As part of the current tariff reset, the Regulator adjusted certain amounts Sul charged its customers in the period prior to the tariff reset. As a result of these adjustments, Sul has recorded regulatory liabilities for excess maintenance costs and disallowed capital expenditure of $21 million and $7 million, respectively, as of March 31, 2013. These regulatory liabilities were offset by a regulatory asset representing an additional tariff of $18 million related to energy purchases.

Other

The Government of Brazil recently announced an Energy Cost Reduction Program, which targets a 20 percent reduction in electricity prices. About one-third of this planned reduction is expected to be driven by lowering sector charges (indirect taxes). The remaining two-thirds of this reduction is being targeted through re-negotiations of new conditions with various generators and transmission and distribution companies, whose concession contracts are up for renewal between 2015 and 2017. The Government of Brazil issued Provision Measure 579 (PM 579) and other related rules. PM 579 was converted into Law 12.783 in January 2013 and the implementation of the Energy Cost Reduction Program was completed in February of 2013 with an average discount of 18% for residential customers and 32% for industrial ones. In order to ensure the discount rate announced by Government, MP 605 and Decree 7.891 were published in January 2013, removing tariff cross-subsidies by an increase of Treasury annual intake to Energy Development Account (CDE) of R$ 8.8 billion, instead of R$ 3.3 billion. The concession at Tietê, our generation business in Brazil, was granted after 1995 and expires in 2029 and thus is not subject to this regulation. Furthermore, we are insulated in the short-term, as 100 percent of Tietê’s output is contracted with Eletropaulo through December of 2015. Beyond 2015, any developments will be a function of the supply-demand and new investment dynamics in Brazil. With regard to our two distribution businesses in Brazil, Eletropaulo and Sul, both utilities also have concessions granted after 1995 and valid until 2028 and 2027, respectively, and thus are not expected to be affected by PM 579. These distribution businesses earn a return on the regulated asset base and energy purchases are treated as a pass-through cost. The final rule did not result in a material impact to our Brazilian businesses or on our results of operations.

Operational

Fluctuations in Foreign Exchange Rates

The Company is sensitive to changes in economic and political conditions, including foreign exchange rates. In Argentina and the Dominican Republic, the potential weakening of economic indicators, such as increased inflation, devaluation of the local currency, currency convertibility restrictions and large government deficits could have a material impact on the Company. Potential outcomes can include negative impacts in our gross margin and cash flows, and create an inability of the business to pay dividends or obtain currency to service foreign obligations, all of which can negatively impact the value of our assets. See Item 3 — Quantitative and Qualitative Disclosures about Market Risk of this Form 10-Q for more information.

Due to our global presence, the Company has significant exposure to foreign currency fluctuations. The exposure is primarily associated with the impact of the translation of our foreign subsidiaries’ operating results from their local currency to U.S. dollars that is required for the preparation of our consolidated financial statements. Additionally, there is a risk of transaction exposure when an entity enters into transactions, including debt agreements, in currencies other than their functional currency. These risks are further described in Item 1A. — Risk Factors of the 2012 Form 10-K, “Our financial position and results of operations may fluctuate significantly due to fluctuations in currency exchange rates experienced at our foreign operations.” In the three months ended March 31, 2013, changes in foreign currency exchange rates have had a significant impact on our operating results. If the current foreign currency exchange rate volatility continues, our gross margin and other financial metrics could continue to be affected.

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Fluctuations in Commodity Prices

The Company is sensitive to changes in natural gas prices. High coal prices relative to natural gas creates pressure at our U.S. businesses, which may affect the results of certain of our coal plants, particularly those which are merchant plants that are exposed to market risk and those that have hybrid merchant risk, meaning those businesses that have a PPA in place, but purchase fuel at market prices or under short term contracts. See Item 3 — Quantitative and Qualitative Disclosures About Market Risk of this Form 10-Q for more information.

Sensitivity to Weather Conditions

Brazil — Given that approximately two-thirds of Brazil’s electric supply is dependent upon hydroelectric generation, changes in weather conditions can have a significant impact on reservoir levels and electricity prices. Lower than expected rainfall during the spring and summer has caused reservoir levels to be lower than their historical levels and affected the availability of hydroelectric generation facilities. If reservoir levels are not able to recover, or deteriorate further, it is expected that higher thermal dispatch will cause more volatility in spot prices. Although the purchased energy cost is a pass-through for AES’s distribution businesses in Brazil, gaps between the purchase of energy and recovery in the tariff could cause temporary cash flow constraints on those businesses. Additionally, if the overall system is short of water, our hydroelectric generation facilities are required to purchase a portion of their contracted energy from the spot market even though such facilities may have enough water to meet their contractual requirements. To the extent that a hydroelectric generation facility needs to purchase energy to meet its contractual requirements, rather than generate, purchasing can be more expensive, thereby creating losses on those contracts, which could have a material adverse impact on our results of operations.

Macroeconomic and Political

During the past few years, economic conditions in some countries where our subsidiaries conduct business have deteriorated. Global economic conditions remain volatile and could have an adverse impact on our businesses in the event these recent trends continue.

Our business or results of operations could be impacted if we or our subsidiaries are unable to access the capital markets on favorable terms or at all, are unable to raise funds through the sale of assets or are otherwise unable to finance or refinance our activities. At this time, several European Union countries continue to face uncertain economic environments, the impacts of which are described below. The Company could also be adversely affected if capital market disruptions result in increased borrowing costs (including with respect to interest payments on the Company’s or our subsidiaries’ variable rate debt) or if commodity prices affect the profitability of our plants or their ability to continue operations.

United States — As noted in Item 1A — Risk Factors — ”We may not be adequately hedged against our exposure to changes in commodity prices or interest rates” of the 2012 Form 10-K and Item 3. — Quantitative and Qualitative Disclosures About Market Risk — Commodity Price Risk of this Form 10-Q, the Company’s U. S. businesses continue to face pressure as a result of low natural gas prices, which is the marginal price-setting fuel in most U. S. markets. This has affected the results of certain of our coal-fired plants in the region, including our coal-fired generating assets within our utility businesses. IPL in Indiana benefits from high wholesale power prices in periods where our available generation exceeds our captive load obligations. At DPL in Ohio, where retail competition exists, our coal-fired generating assets sell excess power into the deregulated market and are subject to greater sensitivity to changes in power prices. Businesses that have a PPA in place, but purchase fuel at market prices or under short term contracts may not be fully hedged against changes in either power or fuel prices.

Argentina — In Argentina, the deterioration of certain economic indicators such as non-receding inflation, increased government deficits and foreign currency accessibility combined with the potential devaluation of the local currency and the potential fall in export commodity prices could cause significant volatility in our results of

38

operations, cash flows, the ability to pay dividends to the Parent Company, and the value of our assets. At March 31, 2013, AES had noncurrent assets of $562 million in Argentina, including long-term receivables of $309 million. See Note 6 — Long-term Financing Receivables in Item 1. — Financial Statements of this Form 10-Q for further information on the long-term receivables.

Bulgaria — Our investments in Bulgaria rely on offtaker contracts with NEK, the state-owned national electricity distribution company. Maritza, a coal-fired generation facility, has experienced ongoing delays in the collection of outstanding receivables from its offtaker. As of March 31, 2013, Maritza had an outstanding receivables balance of $51 million with the offtaker. Although Maritza continued to collect past due receivables during the first quarter of 2013, there can be no assurance that the business will succeed in making these collections, which could result in a write-off of the receivables. In addition, depending on NEK’s ability to honor its obligations and other factors, the value of other assets could also be impaired, or the business may be in default of its loan covenants. The Company has long-lived assets in Bulgaria of $1.6 billion. Any of the above items could have a material impact on our results of operations. For further information on the importance of long-term contracts and our counterparty credit risk, see Item 1A. — Risk Factors — “We may not be able to enter into long-term contracts, which reduce volatility in our results of operations…” of the 2012 Form 10-K. Additionally, the country is scheduled to hold general elections in May 2013 and the new government will need to address several economic challenges faced by the country including higher electricity tariff. At this time, it is difficult to predict the effects of change in the political situation. See Note 29 — Subsequent Events to our consolidated financial statements included in Item 8. — Financial Statements and Supplementary Data of the 2012 Form 10-K for further information. As a result of any of the foregoing events, we may face a loss of earnings and/or cash flows from the affected businesses and may have to provide loans or equity to support affected businesses or projects, restructure them, write down their value and/or face the possibility that these projects cannot continue operations or provide returns consistent with our expectations, any of which could have a material impact on the Company.

Euro Zone — During the past few years, certain European Union countries have continually faced a sovereign debt crisis and it is possible that this crisis could spread to other countries. This crisis has resulted in an increased risk of default by governments and the implementation of austerity measures in certain countries. If the crisis continues, worsens, or spreads, there could be a material adverse impact on the Company. Our businesses may be impacted if they are unable to access the capital markets, face increased taxes or labor costs, or if governments fail to fulfill their obligations to us or adopt austerity measures which adversely impact our projects. As discussed in Item 1A. — Risk Factors — “Our renewable energy projects and other initiatives face considerable uncertainties including development, operational and regulatory challenges” of the 2012 Form 10-K, our renewables businesses are dependent on favorable regulatory incentives, including subsidies, which are provided by sovereign governments, including European governments. If these subsidies or other incentives are reduced or repealed, or sovereign governments are unable or unwilling to fulfill their commitments or maintain favorable regulatory incentives for renewables, in whole or in part, this could impact the ability of the affected businesses to continue to sustain and/or grow their operations and could result in losses or asset impairments for these businesses which could be material. The carrying value of our investment in AES Solar Energy Ltd., whose primary operations are in Europe, was $114 million at March 31, 2013. In addition, any of the foregoing could also impact contractual counterparties of our subsidiaries in core power or renewables. If such counterparties are adversely impacted, then they may be unable to meet their commitments to our subsidiaries.

If global economic conditions deteriorate further, it could also affect the prices we receive for the electricity we generate or transmit. Utility regulators or parties to our generation contracts may seek to lower our prices based on prevailing market conditions pursuant to PPAs, concession agreements or other contracts as they come up for renewal or reset. In addition, rising fuel and other costs coupled with contractual price or tariff decreases could restrict our ability to operate profitably in a given market. Each of these factors, as well as those discussed above, could result in a decline in the value of our assets including those at the businesses we operate, our equity investments and projects under development and could result in asset impairments that could be material to our operations. We continue to monitor our projects and businesses.

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Impairments

Goodwill — The Company seeks business acquisitions as one of its growth strategies. We have achieved significant growth in the past as a result of several business acquisitions, which also resulted in the recognition of goodwill. In the fourth quarter of 2012, the Company completed its annual October 1 goodwill impairment evaluation and identified two reporting units, DPL and Ebute, which were considered “at risk”. A reporting unit is considered “at risk” when its fair value is not higher than its carrying amount by more than 10%. While there were no potential impairment indicators during the three months ended March 31, 2013 related to DPL and Ebute that could result in the recognition of goodwill impairment, it is possible that we may incur goodwill impairment at any of our reporting units in future periods if adverse changes in their business or operating environments occur. The carrying amount of the goodwill at DPL and Ebute as of March 31, 2013 was approximately $759 million and $58 million, respectively. In 2012, the Company had recognized goodwill impairment of $1.82 billion at the DP&L reporting unit.

Environmental

The Company is subject to numerous environmental laws and regulations in the jurisdictions in which it operates. The Company expenses environmental regulation compliance costs as incurred unless the underlying expenditure qualifies for capitalization under its property, plant and equipment policies. The Company faces certain risks and uncertainties related to these environmental laws and regulations, including existing and potential greenhouse gas (“GHG”) legislation or regulations, and actual or potential laws and regulations pertaining to water discharges, waste management (including disposal of coal combustion byproducts), and certain air emissions, such as SO₂, NO_x, particulate matter and mercury. Such risks and uncertainties could result in increased capital expenditures or other compliance costs which could have a material adverse effect on certain of our U.S. or international subsidiaries and our consolidated results of operations. For further information about these risks, see Item 1A. — Risk Factors, “Our businesses are subject to stringent environmental laws and regulations,” “Our businesses are subject to enforcement initiatives from environmental regulatory agencies,” and “Regulators, politicians, non-governmental organizations and other private parties have expressed concern about greenhouse gas, or GHG, emissions and the potential risks associated with climate change and are taking actions which could have a material adverse impact on our consolidated results of operations, financial condition and cash flows” set forth in the Company’s Form 10-K for the year ended December 31, 2012. The following discussion of the impact of environmental laws and regulations on the Company updates the discussion provided in Item 1. Business — Regulatory Matters — Environmental and Land Use Regulations of the Company’s Form 10-K for the year ended December 31, 2012. For further information about environmental laws and regulations impacting the Company, including a discussion of U.S. and international legislation and regulation of GHG emissions, see Item 1. Business — Regulatory Matters — Environmental and Land Use Regulations set forth in the Company’s Form 10-K for the year ended December 31, 2012.

Update on Air Emissions Regulations and Legislation

As further described in Item 1. Business — Regulatory Matters — Environmental and Land Use Regulations in the Company’s Form 10-K for the year ended December 31, 2012, as a result of existing and expected environmental regulations, including the Mercury and Air Toxics Standard (“MATS”), IPL expects to retire several generating units fueled by either coal or oil (approximately 620 MW in total) by April 2016 and to expend significant capital expenditures on environmental controls and upgrades. The units to be retired are not equipped with the advanced environmental control technologies needed to comply with existing and expected regulations, and collectively make up less than 15% of IPL’s net electricity generation over the past five years. In order to replace this generation capacity, IPL filed in April 2013 a petition and case-in-chief with its regulator (the Indiana Utility Regulatory Commission) seeking a Certificate of Public Convenience and Necessity to build a 550 to 725 MW combined cycle gas turbine at its Eagle Valley Station site in Indiana and to refuel Harding Street Station Units 5 and 6 from coal to natural gas (106 MW each). The total estimated cost of these projects is $667 million. IPL is seeking regulatory authority to accrue allowance for debt and equity funds used during construction, and to defer the recognition of depreciation expense on the projects until such time that IPL is

40

allowed to collect a return and depreciation expense on the projects. The combined cycle gas turbine, if approved, is expected to be placed into service in April 2017 and the refueling project is expected to be complete by April 2016. If the Harding Street Units are not refueled, they will likely need to be retired because it is not economical to install controls on those units to comply with MATS. IPL believes recovery of these costs is likely, but not guaranteed and will likely require IPL to file a base rate case.

As a result of existing and expected environmental regulations, including MATS, DP&L has notified PJM that it plans to retire the six coal-fired units aggregating approximately 360 MW at its wholly-owned Hutchings Generation Station. Hutchings Unit 4 is currently out of service with damage to its turbine and will be retired by June 2013. DP&L plans to retire Hutchings Units 1, 2, 3, 5 and 6 by June 2015. Conversion of the coal-fired units to natural gas was investigated, but the cost of investment exceeded the expected return. In addition, DP&L owns approximately 207 MW of coal-fired generation at Beckjord Unit 6, which is operated by Duke Energy Ohio. The co-owners of Beckjord Unit 6 have notified PJM that they plan to retire Beckjord Unit 6 by June 1, 2015. At this time, DP&L does not have plans to replace the units that will be retired.

Update on Regulations Related to Water Discharges

In April 2013, the United States Environmental Protection Agency (“EPA”) announced proposed rules to reduce toxic pollutants discharged into waterways by power plants. The proposed rules are intended to update the existing technology-based rules for controlling the discharge of pollutants from various waste streams associated with steam electric generating facilities. The proposed rules identify four preferred options for controlling the discharge of these pollutants, and EPA believes that over half of existing power plants will comply with these rules, if they become final, without incurring costs. However, it is too early to determine whether the impacts of this rule, if and when it becomes final, will materially impact the Company or its subsidiaries. EPA is required to finalize these rules by May 2014.

In Item 1. Business — Regulatory Matters — Environmental and Land Use Regulations in the Company’s Form 10-K for the year ended December 31, 2012, the Company disclosed that the Indiana Department of Environmental Management (“IDEM”) issued National Pollutant Discharge Elimination System (“NPDES”) permits to the IPL Petersburg, Harding Street and Eagle Valley generating stations, which became effective in October 2012, and that IPL was seeking a two-year extension of the compliance deadline required by the permits. In April 2013, IPL received such two-year extension, through September 2017, as part of an agreed order with IDEM.

Additional Environmental Regulatory Events Occurring During Quarter

Please see Item 1. Business — Regulatory Matters — Environmental and Land Use Regulations set forth in the Company’s Form 10-K for the year ended December 31, 2012 for further information about the following events that occurred during the three months ended March 31, 2013 and relate to the impact of environmental laws and regulations on the Company and its subsidiaries:

• On January 7, 2013, the Ohio Environmental Protection Agency issued a NPDES permit for J.M. Stuart Station relating to its wastewater discharges, various aspects of which DP&L subsequently appealed; and

• On January 24, 2013 the United States Circuit Court of Appeals for the District of Columbia Circuit denied petitions for a rehearing of its decision vacating EPA’s Cross-State Air Pollution Rule that were filed by EPA and environmental and health organizations, which organizations subsequently filed petitions for writs of certiorari with the U.S. Supreme Court.

41

Revenue and Gross Margin Analysis

US SBU

US — Generation

The following table summarizes revenue and gross margin for our US Generation segment for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	170	$	198		-14	%
Gross Margin	$	31	$	53		-42	%

Generation revenue for the three months ended March 31, 2013 decreased $28 million, or 14%, compared to the three months ended March 31, 2012 primarily due to:

• a decrease of $16 million at Beaver Valley in Pennsylvania, as a result of the early termination of the PPA with the offtaker in January 2013; and

• a decrease of $12 million at Hawaii, primarily due to lower availability as a result of a combination of forced and scheduled outages.

Generation gross margin for the three months ended March 31, 2013 decreased $22 million, or 42%, compared to the three months ended March 31, 2012 primarily due to:

• a decrease of $18 million at Hawaii, primarily due to lower availability and increased fixed costs as a result of a combination of forced and scheduled outages; and

• a decrease of $8 million at Beaver Valley as discussed above.

For the three months ended March 31, 2013, revenue decreased 14%, while gross margin decreased by 42%, primarily due to higher fuel costs and increased fixed costs at Hawaii that had a negative impact on gross margin.

US — Utilities

The following table summarizes revenue and gross margin for our US Utilities segment for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	722	$	732		-1	%
Gross Margin	$	118	$	114		4	%

Utilities revenue for the three months ended March 31, 2013 decreased $10 million, or 1%, compared to the three months ended March 31, 2012 primarily due to:

• lower prices of $69 million at DPL, in Ohio, primarily due to lower capacity revenues of $31 million, lower average retail prices of $23 million due to downward price pressure as a result of generation services competition, and lower average wholesale prices of $18 million; and

• a decrease of $6 million at DPL due to the unfavorable impact of mark-to-market adjustments on derivative contracts.

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These decreases were partially offset by:

• higher volume of $38 million at DPL, primarily due to increased energy available for wholesale sales caused by switching of regulated customers to other suppliers as well as increased generation available from DPL’s co-owned and operated plants;

• higher volume of $18 million at IPL in Indiana, primarily due to colder winter weather in 2013 which increased both retail and wholesale electricity demand; and

• higher prices of $8 million at IPL, primarily due to higher fuel adjustment and other pass-through charges.

Utilities gross margin for the three months ended March 31, 2013 increased $4 million, or 4%, compared to the three months ended March 31, 2012 primarily due to:

• lower depreciation and amortization expense of $26 million at DPL primarily because DPL’s ESP intangible asset was fully amortized at the end of 2012;

• higher wholesale margins at DPL of $23 million, primarily due to increased volumes as described above; and

• higher retail and wholesale margins at IPL of $7 million primarily due to the colder winter weather in 2013, which increased demand.

These increases were partially offset by:

• lower retail margin at DPL of $41 million primarily due to DP&L customers switching to DPL Inc.’s competitive retail supplier or other third parties; and

• decrease of $9 million at DPL due to the unfavorable impact of mark-to-market adjustments on derivative contracts.

Andes SBU

Andes — Generation

The following table summarizes revenue and gross margin for our Andes Generation segment for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	691	$	734		-6	%
Gross Margin	$	134	$	167		-20	%

Excluding the unfavorable impact of foreign currency translation and remeasurement of $18 million, generation revenue for the three months ended March 31, 2013 decreased $25 million, or 3%, compared to the three months ended March 31, 2012 primarily due to:

• lower contract and spot prices in Chile of $19 million and lower generation of $13 million mainly due to lower dispatch from gas-fired generation;

• higher outages in Argentina of $10 million, and lower prices in CTSN due to lower coal consumption of $5 million

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These decreases were partially offset by:

• higher revenue of $22 million at Chivor in Colombia mainly driven by higher contract and spot prices due to pressure on prices from lower water inflows.

Excluding the unfavorable impact of foreign currency translation and remeasurement of $2 million, generation gross margin for the three months ended March 31, 2013 decreased $31 million, or 19%, compared to the three months ended March 31, 2012 primarily due to:

• lower margin of $25 million in Chile mainly driven by lower dispatch from gas-fired and coal generation;

• lower revenue in Argentina of $9 million mainly driven by lower generation and lower prices; and

• lower inflows in Chivor partially offset by higher spot and contract price of $3 million.

These decreases were partially offset by:

• new business of $8 million due to the commencement of operations at Ventanas IV in Chile.

For the three months ended March 31, 2013, revenue decreased 6%, while gross margin decreased by 20%. This was primarily due to lower inflows at Chivor equally affecting revenue and gross margin and higher energy costs at Gener impacting gross margin.

Brazil SBU

Brazil — Generation

The following table summarizes revenue and gross margin for our Brazil Generation segment for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	386	$	305		27	%
Gross Margin	$	163	$	225		-28	%

Excluding the unfavorable impact of foreign currency translation of $50 million, generation revenue for the three months ended March 31, 2013 increased $131 million, or 43%, compared to the three months ended March 31, 2012 primarily due to:

• higher volume of $113 million mainly driven by $97 million from generation at Uruguaiana due to the temporary restart of operations during February and March of 2013; and

• higher contract prices of $15 million at Tietê as a result of PPA annual indexation in July of each year.

Excluding the unfavorable impact of foreign currency translation of $20 million, generation gross margin for the three months ended March 31, 2013 decreased $42 million, or 19%, compared to the three months ended March 31, 2012 primarily due to:

• higher energy costs of $60 million at Tietê mainly driven by lower water inflows in the system resulting in higher energy purchases to Tietê due to shared hydrologic risk requirement among all generators at higher spot prices.

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These decreases were partially offset by:

• $13 million of gross margin at Uruguaiana from the temporary restart of operations as mentioned above; and

• lower maintenance costs of $5 million at Tietê.

For the three months ended March 31, 2013, revenue increased 27%, while gross margin decreased by 28% primarily due to Uruguaiana operations from February 2013 offset by higher energy costs in Tietê due to lower water inflows in the system.

Brazil — Utilities

The following table summarizes revenue and gross margin for our Brazil Utilities segment which includes Sul which is 100% owned and Eletropaulo which has an economic ownership of 16% for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	1,323	$	1,531		-14	%
Gross Margin	$	40	$	83		-52	%

Excluding the unfavorable impact of foreign currency translation of $173 million, utilities revenue for the three months ended March 31, 2013 decreased $35 million, or 2%, compared to the three months ended March 31, 2012 primarily due to:

• lower volume of $52 million due to decreased market demand; and

• lower tariff of $41 million at Sul mainly driven by lower energy pass through costs and cumulative adjustment to regulatory assets and liabilities.

These decreases were partially offset by:

• higher tariff of $58 million at Eletropaulo mainly due to higher energy pass through costs and higher tariff compared to the 2012 tariff reset provision.

Excluding the unfavorable impact of foreign currency translation of $6 million in Brazil, utilities gross margin for the three months ended March 31, 2013 decreased $37 million, or 45%, compared to the three months ended March 31, 2012 primarily due to:

• lower volume of $34 million due to decreased market demand;

• lower tariff of $12 million at Sul mainly driven by the cumulative adjustment to regulatory assets and liabilities; and

• higher fixed costs of $8 million mainly driven by higher salaries and contingencies.

These decreases were partially offset by:

• higher tariff of $20 million at Eletropaulo compared to the 2012 tariff reset provision.

For the three months ended March 31, 2013, revenue decreased 14%, while gross margin decreased 52% primarily due to lower demand and higher fixed costs, offset by higher pass through costs.

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MCAC SBU

MCAC — Generation

The following table summarizes revenue and gross margin for our MCAC Generation segment for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	458	$	393		17	%
Gross Margin	$	87	$	105		-17	%

Excluding the favorable impact of foreign currency translation of $2 million, primarily in Mexico, generation revenue for the three months ended March 31, 2013 increased $63 million, or 16%, compared to the three months ended March 31, 2012 primarily due to:

• the positive impact of $42 million at Andres — Los Mina in the Dominican Republic mainly due to higher spot and PPA sales from increased demand and higher international gas prices and volume of gas sales to third parties;

• an increase of $14 million at Merida in Mexico primarily due to higher volume; and

• an increase of $9 million at Panama mainly due to higher volume of PPA energy sales and higher spot sales due to the Esti plant being back on-line from June 2012.

These increases were partially offset by:

• lower contract prices of $7 million at Itabo in the Dominican Republic, primarily related to lower fuel costs.

Generation gross margin for the three months ended March 31, 2013 decreased $18 million, or 17%, compared to the three months ended March 31, 2012 primarily due to:

• a decrease in Panama of $20 million mainly due to higher replacement energy purchases caused by lower hydrology at the Changuinola plant;

• a decrease of $9 million at Andres-Los Mina mainly due to higher fuel costs and higher energy purchases due to increased outages; and

• higher fixed costs across the segment of $9 million mainly due to increased maintenance expenses.

These decreases were partially offset by:

• an increase of $10 million at Andres — Los Mina mainly from higher international gas prices and volume of gas sales to third parties as described above; and

• the positive impact of $10 million at Panama due to the Esti plant as described above.

For the three months ended March 31, 2013, revenue increased 17%, while gross margin decreased by 17% primarily due to higher energy purchases in Panama and the Dominican Republic.

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EMEA SBU

EMEA — Generation

The following table summarizes revenue and gross margin for our EMEA Generation segment for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	351	$	477		-26	%
Gross Margin	$	121	$	247		-51	%

Excluding the unfavorable impact of foreign currency translation of $2 million, generation revenue for the three months ended March 31, 2013 decreased $124 million, or 26%, compared to the three months ended March 31, 2012 primarily due to:

• decrease of $119 million as a result of the sale of 80% of our ownership of AES Cartagena, in Spain, in February 2012 and nonrecurring favorable arbitration settlement in the first quarter of 2012;

• decrease of $10 million at Maritza mainly due to a lower net capacity factor in the first quarter of 2013 versus 2012; and

• net decrease of $9 million at Ballylumford in Northern Ireland, mainly due to lower capacity prices in line with the PPA starting from April 2012 that was partially offset by improved reliability in 2013.

These decreases were partially offset by:

• increase of $17 million at Kilroot due to increased dispatch of the plant and higher electricity prices in Northern Ireland.

Excluding the unfavorable impact of foreign currency translation of $1 million, generation gross margin for the three months ended March 31, 2013 decreased $125 million, or 51%, compared to the three months ended March 31, 2012 primarily due to:

• decrease of $105 million from AES Cartagena as discussed above;

• net decrease of $23 million at Ballylumford as discussed above;

These decreases were partially offset by:

• increase of $9 million at Kilroot mainly due to increased dispatch, increased electricity prices in Northern Ireland and a reduction in the cost of coal.

For the three months ended March 31, 2013, revenue decreased 26%, while gross margin decreased 51% primarily due to the non-recurring arbitration settlement in Cartagena in February 2012.

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Asia SBU

Asia — Generation

The following table summarizes revenue and gross margin for our Generation businesses in Asia for the periods indicated:

	For the Three Months Ended March 31,
	2013		2012		% Change
	($’s in millions)
Revenue	$	134	$	182		-26	%
Gross Margin	$	41	$	54		-24	%

Generation revenue for the three months ended March 31, 2013 decreased $48 million, or 26%, compared to the three months ended March 31, 2012 primarily due to:

• lower generation volume of $24 million at Kelanitissa in Sri Lanka attributable to higher hydrology in the system resulting in lower pass-through revenue;

• decrease of $12 million at Masinloc in the Philippines primarily due to lower rates offset by higher generation; and

• decrease of $10 million at Masinloc due to the non-recurring favorable impact of a mark-to-market adjustment on an embedded derivative in 2012.

Generation gross margin for the three months ended March 31, 2013 decreased $13 million, or 24%, compared to the three months ended March 31, 2012 primarily due to the decrease of $10 million at Masinloc for the non-recurring favorable impact of the mark-to-market derivative adjustment as discussed above.

Corporate and Other

Corporate and other includes the net operating results from our utility businesses in El Salvador, Africa and Europe, which are immaterial for the purposes of separate segment disclosure. The following table includes inter-segment activity and summarizes revenue and gross margin for Corporate and Other entities for the periods indicated:

	For the Three Months Ended March 31,
	2013			2012			% Change
	($’s in millions)
Revenue
El Salvador Utilities	$	211		$	203			4	%
Africa Utilities		107			130			-18	%
Corporate/Other		2			3			-33	%
Total Corporate and Other	$	320		$	336			-5	%
Gross Margin
El Salvador Utilities	$	18		$	16			13	%
Africa Utilities		(8	)		10			-180	%
Corporate/Other		(3	)		(3	)		0	%
Total Corporate and Other	$	7		$	23			-70	%

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Excluding the favorable impact of foreign currency translation of $1 million, revenue for the three months ended March 31, 2013 decreased $17 million, or 5%, compared to the three months ended March 31, 2012, primarily due to:

• the unfavorable impact of a mark-to-market derivative adjustment of $15 million at Sonel in Cameroon; and

• lower rates at Sonel of $10 million mainly due to a favorable 2011 tariff compensation adjustment in the first quarter 2012 not recurring in the first quarter 2013.

These decreases were partially offset by:

• higher rates of $10 million in El Salvador due to the tariff increase and higher pass-through energy costs.

Corporate and Other gross margin for the three months ended March 31, 2013 decreased by $16 million, or 70%, compared to the three months ended March 31, 2012, primarily due to:

• the unfavorable impact of $15 million at Sonel of a mark-to-market derivative adjustment as discussed above.

These decreases were partially offset by:

• an increase of $8 million at Sonel due to a decrease in fuel consumption as a result of better hydrology.

For the three months ended March 31, 2013, revenue decreased 5%, while gross margin decreased by 70% primarily due to the impact of a mark-to-market adjustment at Sonel and higher pass -through energy costs in El Salvador.

General and administrative expenses

General and administrative expenses decreased $26 million, or 30%, to $61 million for the three months ended March 31, 2013 primarily due to Company restructuring efforts, resulting in a decrease in employee related and business development costs.

Interest expense

Interest expense decreased $39 million, or 9%, to $377 million for the three months ended March 31, 2013. The decrease was primarily due to lower interest rates and lower debt principal in Brazil and the Philippines, favorable foreign currency translation in Brazil, as well as lower interest expense for Cartagena, which was deconsolidated following the sale of 80% of our interest in the first quarter of 2012. These decreases were partially offset by interest on regulatory liabilities following the tariff reset in Brazil.

Interest income

Interest income decreased $25 million, or 27%, to $66 million for the three months ended March 31, 2013. The decrease was primarily in Brazil, due to a reduction in interest-bearing assets, unfavorable foreign currency translation and lower interest rates.

Other income and expense

See discussion of the components of other income and expense in Note 12 — Other Income and Expense included in Item 1. — Financial Statements of this Form 10-Q for further information.

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Asset impairment expense

Asset impairment expense was $48 million for the three months ended March 31, 2013 which is primarily related to the impairment at Beaver Valley. See Note 13 — Asset Impairment Expense included in Item 1. — Financial Statements of this Form 10-Q for further information. Asset impairment expense was $10 million for the three months ended March 31, 2012.

Gain on sale of investments

Gain on sale of investments for the three months ended March 31, 2013 was $3 million, which is primarily related to the sale of Chengdu, an equity method investment in China. Gain on sale of investments for the three months ended March 31, 2012 was $179 million, of which $178 million related to the sale of 80% of our interest in Cartagena. See Note 16. — Dispositions included in Item 1. — Financial Statements of this Form 10-Q for further information.

Foreign currency transaction gains (losses)

Foreign currency transaction gains (losses) were as follows:

	Three Months Ended March 31,
	2013			2012
	($’s in millions)
AES Corporation	$	(31	)	$	18
Chile		(4	)		9
Philippines		-			(24	)
Other		3			(4	)
Total(1)	$	(32	)	$	(1	)

⁽¹⁾  Includes $2 million in gains and $39 million in losses on foreign currency derivative contracts for the three months ended March 31, 2013 and 2012, respectively.

The Company recognized net foreign currency transaction losses of $32 million for the three months ended March 31, 2013 primarily due to:

• losses of $31 million at the AES Corporation were primarily related to intercompany notes receivable denominated in foreign currency, resulting from the weakening of the Euro and British Pound during the period.

The Company recognized foreign currency transaction losses of $1 million for the three months ended March 31, 2012 primarily due to:

• gains of $18 million at The AES Corporation were primarily related to intercompany notes receivable denominated in foreign currency, resulting from the strengthening of the Euro and British Pound during the quarter, partially offset by mark-to-market losses on foreign currency derivatives;

• gains of $9 million in Chile primarily related to Chilean Pesos denominated working capital at Gener (a U.S. Dollar functional currency subsidiary) resulting from a 6% appreciation of the Chilean Peso during the period. These gains were partially offset by mark-to-market losses on foreign currency derivatives; and

• losses of $24 million in the Philippines were primarily due to embedded foreign currency derivatives in PPAs. This was partially offset by unrealized foreign currency exchange gains of $5 million due to the 2% appreciation of the Philippine Peso.

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Other non-operating expense

There was no other non-operating expense for the three months ended March 31, 2013. Total other non-operating expense was $49 million for the three months ended March 31, 2012. See Note 14 — Other Non-operating Expense included in Item 1. — Financial Statements of this Form 10-Q for further information.

Income tax expense

Income tax expense decreased $186 million, or 69%, to $82 million for the three months ended March 31, 2013 compared to $268 million for the three months ended March 31, 2012. The Company’s effective tax rates were 27% and 35% for the three months ended March 31, 2013 and 2012, respectively.

The net decrease in the effective tax rate for the three months ended March 31, 2013 compared to the same period in 2012 was principally due to the extension of a favorable U.S. tax law in the first quarter of 2013 impacting distributions from certain non-U.S. subsidiaries and the partial sale of AES Cartagena in the first quarter of 2012. See Note 16 — Dispositions regarding the sale of AES Cartagena included in Item 1. — Financial Statements of this Form 10-Q for further information.

Net equity in earnings of affiliates

Net equity in earnings of affiliates decreased $9 million, or 69%, to $4 million for the three months ended March 31, 2013. The decrease was primarily related to our share of a mark-to-market derivative adjustment along with operational losses at our AES Solar equity investment.

Income from continuing operations attributable to noncontrolling interests

Income from continuing operations attributable to noncontrolling interests decreased $58 million, or 34%, to $115 million for the three months ended March 31, 2013. The decrease was primarily due to a decrease in operating income at Tietê in 2013 related to spot market energy allocation at high prices due to drier hydrology in the system and a reduction in income of non-controlling interests at Cartagena which was deconsolidated in February 2012 as a result of the sale of 80% of our interest.

Discontinued operations

Total discontinued operations was a net loss of $22 million and net income of $1 million for the three months ended March 31, 2013 and 2012, respectively. See Note 15 — Discontinued Operations and Held for Sale Businesses included in Item 1. — Financial Statements of this Form 10-Q for further information.

Capital Resources and Liquidity

Overview

As of March 31, 2013, the Company had unrestricted cash and cash equivalents of $2.3 billion, of which approximately $425 million was held at the Parent Company and qualified holding companies, and approximately $851 million was held in short term investments primarily at subsidiaries. In addition, we had restricted cash and debt service reserves of $1.4 billion. The Company also had non-recourse and recourse aggregate principal amounts of debt outstanding of $15.9 billion and $6.0 billion, respectively. Of the approximately $3.1 billion of our current non-recourse debt, $1.8 billion was presented as such because it is due in the next twelve months and $1.3 billion relates to debt considered in default due to covenant violations. We expect such current maturities will be repaid from net cash provided by operating activities of the subsidiary to which the debt relates or through opportunistic refinancing activity or some combination thereof. Approximately $507 million of our recourse debt matures within the next twelve months, which we expect to repay using a combination of cash on hand at the Parent Company, net cash provided by operating activities and net proceeds

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from the issuance of new debt at the Parent Company. We expect to repay a portion of this amount prior to maturity as part of the tender offers commenced on April 30, 2013. See Note 18 — Subsequent Events included in Item 1. — Financial Statements of this Form 10-Q for further information. See further discussion of Parent Company Liquidity below.

We rely mainly on long-term debt obligations to fund our construction activities. We have, to the extent available at acceptable terms, utilized non-recourse debt to fund a significant portion of the capital expenditures and investments required to construct and acquire our electric power plants, distribution companies and related assets. Our non-recourse financing is designed to limit cross default risk to the Parent Company or other subsidiaries and affiliates. Our non-recourse long-term debt is a combination of fixed and variable interest rate instruments. Generally, a portion or all of the variable rate debt is fixed through the use of interest rate swaps. In addition, the debt is typically denominated in the currency that matches the currency of the revenue expected to be generated from the benefiting project, thereby reducing currency risk. In certain cases, the currency is matched through the use of derivative instruments. The majority of our non-recourse debt is funded by international commercial banks, with debt capacity supplemented by multilaterals and local regional banks.

Given our long-term debt obligations, the Company is subject to interest rate risk on debt balances that accrue interest at variable rates. When possible, the Company will borrow funds at fixed interest rates or hedge its variable rate debt to fix its interest costs on such obligations. In addition, the Company has historically tried to maintain at least 70% of its consolidated long-term obligations at fixed interest rates, including fixing the interest rate through the use of interest rate swaps. These efforts apply to the notional amount of the swaps compared to the amount of related underlying debt. Presently, the Parent Company’s only material un-hedged exposure to variable interest rate debt relates to indebtedness under its senior secured credit facility. On a consolidated basis, of the Company’s $15.9 billion of total non-recourse debt outstanding as of March 31, 2013, approximately $4.6 billion bore interest at variable rates that were not subject to a derivative instrument which fixed the interest rate.

In addition to utilizing non-recourse debt at a subsidiary level when available, the Parent Company provides a portion, or in certain instances all, of the remaining long-term financing or credit required to fund development, construction or acquisition of a particular project. These investments have generally taken the form of equity investments or intercompany loans, which are subordinated to the project’s non-recourse loans. We generally obtain the funds for these investments from our cash flows from operations, proceeds from the sales of assets and/or the proceeds from our issuances of debt, common stock and other securities. Similarly, in certain of our businesses, the Parent Company may provide financial guarantees or other credit support for the benefit of counterparties who have entered into contracts for the purchase or sale of electricity, equipment or other services with our subsidiaries or lenders. In such circumstances, if a business defaults on its payment or supply obligation, the Parent Company will be responsible for the business’ obligations up to the amount provided for in the relevant guarantee or other credit support. At March 31, 2013, the Parent Company had provided outstanding financial and performance-related guarantees or other credit support commitments to or for the benefit of our businesses, which were limited by the terms of the agreements, of approximately $577 million in aggregate (excluding those collateralized by letters of credit and other obligations discussed below).

As a result of the Parent Company’s below investment grade rating, counterparties may be unwilling to accept our general unsecured commitments to provide credit support. Accordingly, with respect to both new and existing commitments, the Parent Company may be required to provide some other form of assurance, such as a letter of credit, to backstop or replace our credit support. The Parent Company may not be able to provide adequate assurances to such counterparties. To the extent we are required and able to provide letters of credit or other collateral to such counterparties, this will reduce the amount of credit available to us to meet our other liquidity needs. At March 31, 2013, we had $3 million in letters of credit outstanding, provided under our senior secured credit facility, and $254 million in cash collateralized letters of credit outstanding outside of our senior

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secured credit facility. These letters of credit operate to guarantee performance relating to certain project development activities and business operations. During the quarter ended March 31, 2013, the Company paid letter of credit fees ranging from 0.25% to 3.25% per annum on the outstanding amounts.

We expect to continue to seek, where possible, non-recourse debt financing in connection with the assets or businesses that we or our affiliates may develop, construct or acquire. However, depending on local and global market conditions and the unique characteristics of individual businesses, non-recourse debt may not be available on economically attractive terms or at all. If we decide not to provide any additional funding or credit support to a subsidiary project that is under construction or has near-term debt payment obligations and that subsidiary is unable to obtain additional non-recourse debt, such subsidiary may become insolvent, and we may lose our investment in that subsidiary. Additionally, if any of our subsidiaries lose a significant customer, the subsidiary may need to withdraw from a project or restructure the non-recourse debt financing. If we or the subsidiary choose not to proceed with a project or are unable to successfully complete a restructuring of the non-recourse debt, we may lose our investment in that subsidiary.

Many of our subsidiaries depend on timely and continued access to capital markets to manage their liquidity needs. The inability to raise capital on favorable terms, to refinance existing indebtedness or to fund operations and other commitments during times of political or economic uncertainty may have material adverse effects on the financial condition and results of operations of those subsidiaries. In addition, changes in the timing of tariff increases or delays in the regulatory determinations under the relevant concessions could affect the cash flows and results of operations of our businesses.

As of March 31, 2013, the Company had approximately $348 million and $26 million of accounts receivable related to certain of its generation businesses in Argentina and the Dominican Republic, and its utility businesses in Brazil classified as “Noncurrent assets — other” and “Current assets — Accounts receivable,” respectively. The noncurrent portion primarily consists of accounts receivable in Argentina that, pursuant to amended agreements or government resolutions, have collection periods that extend beyond March 31, 2014, or one year from the latest balance sheet date. See Note 6 — Long-term Financing Receivables included in Item 1. — Financial Statement of this Form 10-Q and Item 1. — Business — Regulatory Matters — Argentina included in the 2012 Form 10-K for further information.

Consolidated Cash Flows

During the three months ended March 31, 2013, cash and cash equivalents increased $335 million to $2.3 billion. The increase in cash and cash equivalents was due to $618 million of cash provided by operating activities, $726 million of cash used in investing activities, $455 million of cash provided by financing activities, an unfavorable effect of foreign currency exchange rates on cash of $8 million and a $4 million increase in cash of discontinued and held for sale businesses.

Operating Activities — Net cash provided by operating activities increased $84 million to $618 million during the three months ended March 31, 2013 compared to $534 million during the three months ended March 31, 2012.

Operating cash flow for the three months ended March 31, 2013 resulted primarily from the net income adjusted for non-cash items, principally depreciation and amortization and gain from sale of investments and impairment charges, partially offset by a net use of cash for operating activities of $149 million in operating assets and liabilities. Prepaid expenses and other current assets increased $192 million primarily due to a receivable from the regulator to reduce the impacts of higher thermoelectric energy costs and involuntary exposure to high spot market prices at Eletropaulo and Sul. Net income tax payables decreased $123 million primarily from payments of income taxes exceeding accruals for the first quarter 2013 tax liability. These uses of operating cash flows were partially offset by an increase of $174 million in accounts payable and other current liabilities primarily due to the return of operations at Uruguaiana in February 2013, higher energy purchases in the spot market at Tietê, an increase in accrued interest at the Parent Company, an increase in the coal purchases

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accrual at Kilroot, partially offset by a decrease in other current liabilities at Eletropaulo arising from lower value added tax payments due to the lower tariff in 2013 less an increase in accounts payable due to the higher price of energy purchases.

Net cash provided by operating activities was $534 million during the three months ended March 31, 2012. Operating cash flow resulted primarily from the net income adjusted for non-cash items, principally depreciation and amortization, deferred income taxes and gain on sales of investments and impairment expense, partially offset by a net use of cash for operating activities of $327 million in operating assets and liabilities. Accounts receivable increased $189 million primarily due to lower collections at Itabo, Los Mina and Maritza as well as an increase in revenue at Kelanitissa, Sul and Sonel. Net income tax payables decreased $161 million primarily from payments of income taxes exceeding accruals for new current tax liabilities. Other assets increased $156 million primarily due to an increase in noncurrent regulatory assets at Eletropaulo, resulting from higher priced energy purchases and regulatory charges which are recoverable through future tariff and the establishment of a noncurrent note receivable at Cartagena in Spain following the arbitration settlement, prior to its deconsolidation. Prepaid expenses and other current assets increased $117 million primarily due to an increase in current regulatory assets at Eletropaulo reflecting higher subsidies to free consumers and higher priced energy purchases as well as a prepayment for gas at Andres. These uses of operating cash flows were partially offset by an increase of $266 million in accounts payable and accrued liabilities primarily due to an increase in regulatory liabilities driven by the tariff reset at Eletropaulo and an increase of Esti tunnel repair liabilities at Panama.

This net increase of cash flows from continuing operations of $84 million for the three months ended March 31, 2013 compared to the three months ended March 31, 2012 was primarily the result of the following:

• US — an increase of $67 million at our generation businesses primarily due to proceeds of $60 million from the PPA termination at Beaver Valley in January 2013.

• Andes — a decrease of $59 million at our generation businesses primarily driven by income tax payments at Chivor.

• MCAC — an increase of $75 million at our generation businesses primarily due to the prepayment of gas in 2012 at Andres and higher collections and lower payments at Itabo.

Investing Activities — Net cash used in investing activities was $726 million during the three months ended March 31, 2013. This was primarily attributable to capital expenditures of $546 million consisting of $334 million of growth capital expenditures and $212 million of maintenance and environmental capital expenditures. Growth capital expenditures included amounts at Mong Duong of $147 million, Eletropaulo of $72 million, Gener of $27 million, Sul of $17 million and Jordan of $11 million. Maintenance and environmental capital expenditures included amounts at IPALCO of $42 million, Eletropaulo of $33 million, Gener of $27 million, Sul of $27 million, DPL of $24 million and Tietê of $17 million. Purchases of short-term investments, net of sales, were $157 million primarily at Sul of $111 million and Tietê of $80 million offset by sales of $20 million at Eletropaulo.

Net cash used for investing activities was $725 million during the three months ended March 31, 2012. This was primarily attributable to capital expenditures of $579 million consisting of $338 million of growth capital expenditures and $241 million of maintenance and environmental capital expenditures. Growth capital expenditures included amounts at Gener of $77 million, Eletropaulo of $66 million, Mong Duong of $40 million, DPL of $26 million, Sul of $24 million, Maritza of $18 million and Mountain View 4 of $16 million. Maintenance and environmental capital expenditures included amounts at Eletropaulo of $50 million, IPL of $31 million, DPL of $27 million, Panama of $25 million and Sul of $23 million. Purchases of short-term investments, net of sales were $350 million primarily at Eletropaulo of $365 million offset by sales of $21 million at Gener. These uses of cash were partially offset by proceeds from government grants for asset construction of $85 million primarily for funds received at our wind project Laurel Mountain and proceeds from the sale of businesses, net of cash sold of $63 million for the sale of 80% of our interest in Cartagena in February.

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Net cash used in investing activities increased $1 million to $726 million during the three months ended March 31, 2013 compared to $725 million during the three months ended March 31, 2012. This net increase was primarily due to decreases in proceeds from government grants of $84 million, increases of restricted cash of $63 million and decreases in proceeds from the sale of business of $62 million offset by a decrease of purchases of short-term investments, net of sales of $193 million.

Financing Activities — Net cash provided by financing activities was $455 million during the three months ended March 31, 2013. Proceeds from the issuances of non-recourse debt of $1.5 billion included amounts at Masinloc of $500 million, El Salvador of $310 million, Tietê of $251 million, Sul of $150 million, Mong Duong of $119 million, Warrior Run of $74 million, Kribi of $31 million, Puerto Rico of $25 million and Jordan of $18 million. This was partially offset by repayments of non-recourse debt of $1 billion primarily at Masinloc of $531 million, El Salvador of $150 million, Warrior Run of $80 million, Tietê of $60 million, Puerto Rico of $38 million, Sul of $34 million, Maritza of $29 million, Sonel of $22 million and Angamos of $21 million.

Net cash provided by financing activities was $37 million during the three months ended March 31, 2012. Proceeds from the issuances of non-recourse debt of $503 million included amounts at Eletropaulo of $339 million, Kribi of $41 million, Mong Duong of $37 million and Alicura in Argentina of $34 million. This was partially offset by net repayments under revolving credit facilities of $281 million primarily at the Parent Company and $151 million for the repayments of non-recourse debt primarily at Maritza for $25 million, Sonel for $23 million, our European wind projects for $22 million and Masinloc for $20 million.

Net cash provided by financing activities increased $418 million to $455 million during the three months ended March 31, 2013 compared to net cash provided by financing of $37 million during the three months ended March 31, 2012. This net increase was primarily due to increases in proceeds from issuance of non-recourse debt of $988 million and increases in net borrowings under revolving credit facilities of $296 million, partially offset by increases in repayments of non-recourse debt of $856 million.

Parent Company Liquidity

The following discussion of Parent Company Liquidity has been included because we believe it is a useful measure of the liquidity available to The AES Corporation, or the Parent Company, given the non-recourse nature of most of our indebtedness. Parent Company Liquidity as outlined below is a non-GAAP measure and should not be construed as an alternative to cash and cash equivalents which are determined in accordance with GAAP, as a measure of liquidity. Cash and cash equivalents are disclosed in the condensed consolidated statements of cash flows. Parent Company liquidity may differ from similarly titled measures used by other companies. The principal sources of liquidity at the Parent Company level are:

• dividends and other distributions from our subsidiaries, including refinancing proceeds;

• proceeds from debt and equity financings at the Parent Company level, including availability under our credit facilities; and

• proceeds from asset sales.

Cash requirements at the Parent Company level are primarily to fund:

• interest;

• principal repayments of debt;

• acquisitions;

• construction commitments;

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• other equity commitments;

• equity repurchases;

• taxes;

• Parent Company overhead and development costs; and

• dividends on common stock.

The Company defines Parent Company Liquidity as cash available to the Parent Company plus available borrowings under existing credit facilities. The cash held at qualified holding companies represents cash sent to subsidiaries of the Company domiciled outside of the U.S. Such subsidiaries have no contractual restrictions on their ability to send cash to the Parent Company. Parent Company Liquidity is reconciled to its most directly comparable U.S. GAAP financial measure, “cash and cash equivalents,” at March 31, 2013 and December 31, 2012 as follows:

Parent Company Liquidity	March 31, 2013			December 31, 2012
	(in millions)
Consolidated cash and cash equivalents	$	2,301		$	1,966
Less: Cash and cash equivalents at subsidiaries		(1,876	)		(1,655	)
Parent and qualified holding companies’ cash and cash equivalents		425			311
Commitments under Parent credit facilities		800			800
Less: Letters of credit under the credit facilities		(3	)		(5	)
Borrowings available under Parent credit facilities		797			795
Total Parent Company Liquidity	$	1,222		$	1,106

The Company paid a dividend of $0.04 per share to its common stockholders during the three months ended March 31, 2013. While we intend to continue payment of dividends and believe we will have sufficient liquidity to do so, we can provide no assurance we will be able to continue the payment of dividends.

While we believe that our sources of liquidity will be adequate to meet our needs for the foreseeable future, this belief is based on a number of material assumptions, including, without limitation, assumptions about our ability to access the capital markets (see Key Trends and Uncertainties and Global Economic Considerations in this Item 2), the operating and financial performance of our subsidiaries, currency exchange rates, power market pool prices, and the ability of our subsidiaries to pay dividends. In addition, our subsidiaries’ ability to declare and pay cash dividends to us (at the Parent Company level) is subject to certain limitations contained in loans, governmental provisions and other agreements. We can provide no assurance that these sources will be available when needed or that the actual cash requirements will not be greater than anticipated. We have met our interim needs for shorter-term and working capital financing at the Parent Company level with our senior secured credit facility. See Item 1A. — Risk Factors, “The AES Corporation is a holding company and its ability to make payments on its outstanding indebtedness, including its public debt securities, is dependent upon the receipt of funds from its subsidiaries by way of dividends, fees, interest, loans or otherwise.” of the Company’s 2012 Form 10-K.

Various debt instruments at the Parent Company level, including our senior secured credit facilities, contain certain restrictive covenants. The covenants provide for, among other items:

• limitations on other indebtedness, liens, investments and guarantees;

• limitations on dividends, stock repurchases and other equity transactions;

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• restrictions and limitations on mergers and acquisitions, sales of assets, leases, transactions with affiliates and off-balance sheet and derivative arrangements;

• maintenance of certain financial ratios; and

• financial and other reporting requirements.

As of March 31, 2013, the Parent Company was in compliance with these covenants.

Non-Recourse Debt

While the lenders under our non-recourse debt financings generally do not have direct recourse to the Parent Company, defaults thereunder can still have important consequences for our results of operations and liquidity, including, without limitation:

• reducing our cash flows as the subsidiary will typically be prohibited from distributing cash to the Parent Company during the time period of any default;

• triggering our obligation to make payments under any financial guarantee, letter of credit or other credit support we have provided to or on behalf of such subsidiary;

• causing us to record a loss in the event the lender forecloses on the assets; and

• triggering defaults in our outstanding debt at the Parent Company.

For example, our senior secured credit facilities and outstanding debt securities at the Parent Company include events of default for certain bankruptcy related events involving material subsidiaries. In addition, our revolving credit agreement at the Parent Company includes events of default related to payment defaults and accelerations of outstanding debt of material subsidiaries.

Some of our subsidiaries are currently in default with respect to all or a portion of their outstanding indebtedness. The total non-recourse debt classified as current in the accompanying condensed consolidated balance sheet amounts to $3.1 billion. The portion of current debt related to such defaults was $1.3 billion at March 31, 2013, all of which was non-recourse debt related to four subsidiaries — Maritza, Sonel, Kavarna, and Saurashtra.

None of the subsidiaries that are currently in default are subsidiaries that met the applicable definition of materiality under AES’s corporate debt agreements as of March 31, 2013 in order for such defaults to trigger an event of default or permit acceleration under AES’s indebtedness. However, as a result of additional dispositions of assets, other significant reductions in asset carrying values or other matters in the future that may impact our financial position and results of operations or the financial position of the individual subsidiary, it is possible that one or more of these subsidiaries could fall within the definition of a “material subsidiary” and thereby upon an acceleration trigger an event of default and possible acceleration of the indebtedness under the Parent Company’s outstanding debt securities.

Critical Accounting Policies and Estimates

The condensed consolidated financial statements of AES are prepared in conformity with U.S. GAAP, which requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the periods presented. The Company’s significant accounting policies are described in Note 1 — General and Summary of Significant Accounting Policies to the consolidated financial statements included in our 2012 Form 10-K. The Company’s critical accounting estimates are described in Management’s Discussion and

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Analysis of Financial Condition and Results of Operations included in the 2012 Form 10-K. An accounting estimate is considered critical if the estimate requires management to make an assumption about matters that were highly uncertain at the time the estimate was made, different estimates reasonably could have been used, or if changes in the estimate that would have a material impact on the Company’s financial condition or results of operations are reasonably likely to occur from period to period. Management believes that the accounting estimates employed are appropriate and resulting balances are reasonable; however, actual results could differ from the original estimates, requiring adjustments to these balances in future periods. The Company has reviewed and determined that those policies remain the Company’s critical accounting policies as of and for the three months ended March 31, 2013.

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ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Overview Regarding Market Risks

Our generation and utility businesses are exposed to and proactively manage market risk. Our primary market risk exposure is to the price of commodities, particularly electricity, oil, natural gas, coal and environmental credits. We operate in multiple countries and as such are subject to volatility in exchange rates at varying degrees at the subsidiary level and between our functional currency, the U.S. Dollar, and currencies of the countries in which we operate. We are also exposed to interest rate fluctuations due to our issuance of debt and related financial instruments.

These disclosures set forth in this Item 3 are based upon a number of assumptions; actual effects may differ. The safe harbor provided in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 shall apply to the disclosures contained in this Item 3. For further information regarding market risk, see Item 1A. — Risk Factors, Our financial position and results of operations may fluctuate significantly due to fluctuations in currency exchange rates experienced at our foreign operations, Our businesses may incur substantial costs and liabilities and be exposed to price volatility as a result of risks associated with the wholesale electricity markets, which could have a material adverse effect on our financial performance, and We may not be adequately hedged against our exposure to changes in commodity prices or interest rates of the 2012 Form 10-K.

Commodity Price Risk

Although we prefer to hedge our exposure to the impact of market fluctuations in the price of electricity, fuels and environmental credits, some of our generation businesses operate under short-term sales or under contract sales that leave an un-hedged exposure on some of capacity, or through imperfect pass throughs. In our utility businesses, we may be exposed to commodity price movements depending on our excess or shortfall of generation relative to load obligations, and sharing or pass through mechanisms. These businesses subject our operational results to the volatility of prices for electricity, fuels and environmental credits in competitive markets. We employ risk management strategies to hedge our financial performance against the effects of fluctuations in energy commodity prices. The implementation of these strategies can involve the use of physical and financial commodity contracts, futures, swaps and options.

When hedging the output of our generation assets, we have contract sales that lock in the spread per MWh between variable costs, such as fuel, to generate a unit of electricity and the price at which the electricity can be sold. The portion of our sales and purchases that are not subject to such agreements will be exposed to commodity price risk or to the extent indexation is not perfectly matched to the business drivers.

AES businesses will see changes in variable margin performance as global commodity prices shift. For the balance of 2013, we project pretax earnings exposure on a 10% move in commodity prices would be approximately $10 million for coal, $10 million for oil and $15 million for natural gas. Our estimates exclude correlation. For example, a decline in oil or natural gas prices can be accompanied by a decline in coal price if commodity prices are correlated. In aggregate, the Company’s downside exposure occurs with lower oil, lower natural gas, and higher coal prices. Exposures at individual businesses will change as new contracts or financial hedges are executed, and our sensitivity to changes in commodity prices generally increases in later years with reduced hedge levels at some of our businesses.

Commodity prices affect our businesses differently depending on the local market characteristics and risk management strategies. Generation costs can be directly affected by movements in the price of natural gas, oil and coal. Spot power prices and contract indexation provisions are affected by the same commodity price movements. We have some natural offsets across our businesses such that low commodity prices may benefit certain businesses and be a cost to others. Offsets are not perfectly linear or symmetric. The sensitivities are affected by a number of non-market, or indirect market factors. Examples of these factors include hydrology,

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energy market supply/demand balances, regional fuel supply issues, regional competition, bidding strategies and regulatory interventions such as price caps. Operational flexibility changes the shape of our sensitivities. For instance, certain power plants may reduce dispatch in low market environments limiting downside exposure. Volume variation also affects our commodity exposure. The volume sold under contracts or retail concessions can vary based on weather and economic conditions resulting in a higher or lower volume of sales in spot markets. Thermal unit availability and hydrology can affect the generation output available for sale and can affect the marginal unit setting power prices.

In the US SBU, the generation businesses are largely contracted but may have residual risk to the extent contracts are not perfectly indexed to the business drivers. IPL sells power at wholesale once retail demand is served, so retail sales demand may affect commodity exposure. Additionally, at DPL, open access allows our retail customers to switch to alternative suppliers; falling energy prices may increase the rate at which our customers switch to alternative suppliers; DPL sells generation in excess of its retail demand under short-term sales; and the outcome of the DPL regulatory filing may affect our level of commodity price exposure over time. Given that natural gas-fired generators set power prices for many markets, higher natural gas prices expand margins. The positive impact on margins will be moderated if natural gas-fired generators set the market price only during peak periods.

For the Andes SBU, our business in Chile owns assets in the central and northern regions of the country and has a portfolio of contract sales in both. While we have been adding coal-fired generation to our portfolio in Chile, a small amount of efficient generation is sold into the spot market. Other assets in Chile include natural gas/diesel, hydroelectric and biomass generation facilities. Generators with oil or oil-linked fuel generally set power prices in these markets impacting spot power margins. In Colombia we operate under a short-term sales strategy and have commodity exposure to un-hedged volumes. Because we own hydroelectric assets there, contracts are not indexed to fuel.

The businesses in the MCAC SBU have commodity exposure on un-hedged volumes. Panama is largely contracted under a portfolio of contract sales, and the un-hedged portion of our hydroelectric assets in Panama is sensitive to changes in spot power prices which may be driven by oil prices in some time periods. In the Dominican Republic, we own natural gas-fired assets contracted under a portfolio of contract sales and a coal-fired asset contracted with a single contract, and both contract and spot prices may move with commodity prices.

In the EMEA SBU, our Kilroot facility operates on a short-term sales strategy. The commodity risk at our Kilroot business is due to the dark spread, the difference between electricity price and our coal based variable dispatch cost, to the extent sales are un-hedged. Natural gas-fired generators set power prices for many periods, so higher natural gas prices expand margins and higher coal prices cause a decline. The positive impact on margins will be moderated if natural gas-fired generators set the market price only during certain peak periods. At our Ballylumford facility, NIAUR, the regulator, has the right to terminate the contract, which would impact our commodity exposure. Our operations in Turkey are sensitive to the spread between power and natural gas prices, both of which have historically demonstrated a relationship to oil. As a result of these relationships, falling oil prices could compress margins realized at the business.

In the Asia SBU, our Masinloc business is a coal-fired generation facility which hedges its output under a portfolio of contract sales that are indexed to fuel prices, with generation in excess of contract volume sold in the spot market. Low oil prices may be a driver of margin compression since oil affects spot power sale prices.

Foreign Exchange Rate Risk

In the normal course of business, we are exposed to foreign currency risk and other foreign operations risks that arise from investments in foreign subsidiaries and affiliates. A key component of these risks stems from the

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fact that some of our foreign subsidiaries and affiliates utilize currencies other than our consolidated reporting currency, the U.S. Dollar. Additionally, certain of our foreign subsidiaries and affiliates have entered into monetary obligations in the U.S. Dollar or currencies other than their own functional currencies. Primarily, we are exposed to changes in the exchange rate between the U.S. Dollar and the following currencies: Argentine Peso, Brazilian Real, British Pound, Cameroonian Franc, Chilean Peso, Colombian Peso, Dominican Peso, Euro, Indian Rupee, Kazakhstani Tenge, Philippine Peso, and Ukrainian Hryvnia. These subsidiaries and affiliates have attempted to limit potential foreign exchange exposure by entering into revenue contracts that adjust to changes in foreign exchange rates. We also use foreign currency forwards, swaps and options, where possible, to manage our risk related to certain foreign currency fluctuations.

We have entered into hedges to partially mitigate the exposure of earnings translated into the U.S. Dollar to foreign exchange volatility. The largest foreign exchange risks are stemming from the following currencies: Argentine Peso, Brazilian Real, Colombian Peso and Euro, determined based on historic volatility over the preceding twelve-month period. As of March 31, 2013, assuming a 10% U.S. Dollar appreciation, adjusted pretax earnings attributable to foreign subsidiaries exposed to movement in the exchange rate of the Argentine Peso, Brazilian Real, Colombian Peso and Euro (the earnings attributable to the subsidiaries exposed to the Cameroonian Franc movements are included under Euro due to the fixed exchange rate of the Cameroonian Franc to the Euro) relative to the U.S. Dollar are projected to be reduced by approximately $10 million, $15 million, $10 million, and $10 million, respectively, for the balance of 2013. These numbers have been produced by applying a one-time 10% U.S. Dollar appreciation to forecasted exposed pretax earnings for the balance of 2013 coming from the respective subsidiaries exposed to the currencies listed above, net of the impact of outstanding hedges and holding all other variables constant. The numbers presented above are net of any transactional gains/losses. These sensitivities may change in the future as new hedges are executed or existing hedges are unwound. Additionally, updates to the forecasted pretax earnings exposed to foreign exchange risk may result in further modification. The sensitivities presented do not capture the impacts of any administrative market restrictions or currency inconvertibility.

Interest Rate Risks

We are exposed to risk resulting from changes in interest rates as a result of our issuance of variable and fixed-rate debt, as well as interest rate swap, cap and floor and option agreements.

Decisions on the fixed-floating debt ratio are made to be consistent with the risk factors faced by individual businesses or plants. Depending on whether a plant’s capacity payments or revenue stream is fixed or varies with inflation, we partially hedge against interest rate fluctuations by arranging fixed-rate or variable-rate financing. In certain cases, particularly for non-recourse financing, we execute interest rate swap, cap and floor agreements to effectively fix or limit the interest rate exposure on the underlying financing. Most of our interest rate risk is related to non-recourse financings at our businesses.

As of March 31, 2013, the portfolio’s pretax earnings exposure for the balance of 2013 to a 100 basis point increase in interest rates for our Argentine Peso, Brazilian Real, Columbian Peso, British Pound, Euro, Indian Rupee, Philippine Peso, Kazakhstani Tenge, and U.S. Dollar denominated debt would be approximately $20 million based on the impact of a one-time, 100 basis point upward shift in interest rates on interest expense for the debt denominated in these currencies. The amounts do not take into account the historical correlation between these interest rates.

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ITEM 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company, under the supervision and with the participation of its management, including the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), evaluated the effectiveness of its “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our CEO and CFO have concluded that our disclosure controls and procedures were effective as of March 31, 2013 to ensure that information required to be disclosed by the Company in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and include controls and procedures designed to ensure that information required to be disclosed by us in such reports is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Controls over Financial Reporting

There were no changes that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II: OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

The Company is involved in certain claims, suits and legal proceedings in the normal course of business. The Company has accrued for litigation and claims where it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company believes, based upon information it currently possesses and taking into account established reserves for estimated liabilities and its insurance coverage, that the ultimate outcome of these proceedings and actions is unlikely to have a material adverse effect on the Company’s financial statements. It is reasonably possible, however, that some matters could be decided unfavorably to the Company and could require the Company to pay damages or make expenditures in amounts that could be material but cannot be estimated as of March 31, 2013.

In 1989, Centrais Elétricas Brasileiras S.A. (“Eletrobrás”) filed suit in the Fifth District Court in the State of Rio de Janeiro (“FDC”) against Eletropaulo Eletricidade de São Paulo S.A. (“EEDSP”) relating to the methodology for calculating monetary adjustments under the parties’ financing agreement. In April 1999, the FDC found for Eletrobrás and in September 2001, Eletrobrás initiated an execution suit in the FDC to collect approximately R$1.35 billion ($667 million) from Eletropaulo (as estimated by Eletropaulo) and a lesser amount from an unrelated company, Companhia de Transmissão de Energia Elétrica Paulista (“CTEEP”) (Eletropaulo and CTEEP were spun off from EEDSP pursuant to its privatization in 1998). In November 2002, the FDC rejected Eletropaulo’s defenses in the execution suit. Eletropaulo appealed and in September 2003, the Appellate Court of the State of Rio de Janeiro (“AC”) ruled that Eletropaulo was not a proper party to the litigation because any alleged liability had been transferred to CTEEP pursuant to the privatization. In June 2006, the Superior Court of Justice (“SCJ”) reversed the Appellate Court’s decision and remanded the case to the FDC for further proceedings, holding that Eletropaulo’s liability, if any, should be determined by the FDC. Eletropaulo’s subsequent appeals were dismissed. In February 2010, the FDC appointed an accounting expert to determine the amount of the alleged debt and the responsibility for its payment in light of the privatization, in accordance with the methodology proposed by Eletrobrás. Eletropaulo filed an interlocutory appeal with the AC asserting that the expert was required to determine the issues in accordance with the methodology proposed by Eletropaulo, and that Eletropaulo should be entitled to take discovery and present arguments on the issues to be determined by the expert. In April 2010, the AC issued a decision agreeing with Eletropaulo’s arguments and directed the FDC to proceed accordingly. However, in December 2012, the FDC disregarded the AC’s decision that the parties were entitled to full discovery and an expert appraisal of the issues prior to the resolution of the case and, instead, issued a decision finding Eletropaulo liable for the debt. The AC subsequently granted Eletropaulo’s request to suspend the execution suit in the FDC and thereafter annulled the FDC’s decision. The case has returned to the FDC for proceedings in accordance with the AC’s April 2010 decision. If the FDC again finds Eletropaulo liable for the debt, after the amount of the alleged debt is determined, Eletrobrás will be entitled to resume the execution suit in the FDC. If Eletrobrás does so, Eletropaulo will be required to provide security for its alleged liability. In that case, if Eletrobrás requests the seizure of such security and the FDC grants such request, Eletropaulo’s results of operations may be materially adversely affected and, in turn the Company’s results of operations could be materially adversely affected. In addition, in February 2008, CTEEP filed a lawsuit in the FDC against Eletrobrás and Eletropaulo seeking a declaration that CTEEP is not liable for any debt under the financing agreement. Eletropaulo believes it has meritorious defenses to the claims asserted against it and will defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

In September 1996, a public civil action was asserted against Eletropaulo and Associação Desportiva Cultural Eletropaulo (the “Associação”) relating to alleged environmental damage caused by construction of the Associação near Guarapiranga Reservoir. The initial decision that was upheld by the Appellate Court of the State of São Paulo in 2006 found that Eletropaulo should repair the alleged environmental damage by demolishing certain construction and reforesting the area, and either sponsor an environmental project which would cost approximately R$1 million ($593 thousand) as of December 31, 2012, or pay an indemnification amount of approximately R$15 million ($7 million). Eletropaulo has appealed this decision to the Supreme Court and the

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Supreme Court affirmed the decision of the Appellate Court. Following the Supreme Court’s decision, the case is being remanded to the court of first instance for further proceedings and to monitor compliance by the defendants with the terms of the decision.

In August 2001, the Grid Corporation of Orissa, India, now Gridco Ltd. (“Gridco”), filed a petition against the Central Electricity Supply Company of Orissa Ltd. (“CESCO”), an affiliate of the Company, with the Orissa Electricity Regulatory Commission (“OERC”), alleging that CESCO had defaulted on its obligations as an OERC-licensed distribution company, that CESCO management abandoned the management of CESCO, and seeking interim measures of protection, including the appointment of an administrator to manage CESCO. Gridco, a state-owned entity, is the sole wholesale energy provider to CESCO. Pursuant to the OERC’s August 2001 order, the management of CESCO was replaced with a government administrator who was appointed by the OERC. The OERC later held that the Company and other CESCO shareholders were not necessary or proper parties to the OERC proceeding. In August 2004, the OERC issued a notice to CESCO, the Company and others giving the recipients of the notice until November 2004 to show cause why CESCO’s distribution license should not be revoked. In response, CESCO submitted a business plan to the OERC. In February 2005, the OERC issued an order rejecting the proposed business plan. The order also stated that the CESCO distribution license would be revoked if an acceptable business plan for CESCO was not submitted to and approved by the OERC prior to March 31, 2005. In its April 2, 2005 order, the OERC revoked the CESCO distribution license. CESCO has filed an appeal against the April 2, 2005 OERC order and that appeal remains pending in the Indian courts. In addition, Gridco asserted that a comfort letter issued by the Company in connection with the Company’s indirect investment in CESCO obligates the Company to provide additional financial support to cover all of CESCO’s financial obligations to Gridco. In December 2001, Gridco served a notice to arbitrate pursuant to the Indian Arbitration and Conciliation Act of 1996 on the Company, AES Orissa Distribution Private Limited (“AES ODPL”), and Jyoti Structures (“Jyoti”) pursuant to the terms of the CESCO Shareholders Agreement between Gridco, the Company, AES ODPL, Jyoti and CESCO (the “CESCO arbitration”). In the arbitration, Gridco appeared to be seeking approximately $189 million in damages, plus undisclosed penalties and interest, but a detailed alleged damage analysis was not filed by Gridco. The Company counterclaimed against Gridco for damages. In June 2007, a 2-to-1 majority of the arbitral tribunal rendered its award rejecting Gridco’s claims and holding that none of the respondents, the Company, AES ODPL, or Jyoti, had any liability to Gridco. The respondents’ counterclaims were also rejected. In September 2007, Gridco filed a challenge of the arbitration award with the local Indian court. In June 2010, a 2-to-1 majority of the arbitral tribunal awarded the Company some of its costs relating to the arbitration. In August 2010, Gridco filed a challenge of the cost award with the local Indian court. The Company believes that it has meritorious defenses to the claims asserted against it and will defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

In early 2002, Gridco made an application to the OERC requesting that the OERC initiate proceedings regarding the terms of OPGC’s existing PPA with Gridco. In response, OPGC filed a petition in the Indian courts to block any such OERC proceedings. In early 2005, the Orissa High Court upheld the OERC’s jurisdiction to initiate such proceedings as requested by Gridco. OPGC appealed that High Court’s decision to the Supreme Court and sought stays of both the High Court’s decision and the underlying OERC proceedings regarding the PPA’s terms. In April 2005, the Supreme Court granted OPGC’s requests and ordered stays of the High Court’s decision and the OERC proceedings with respect to the PPA’s terms. In December 2012, the parties executed a settlement agreement amending the PPA and resolving the dispute. Pursuant to the settlement, the appeal in the Supreme Court has been withdrawn. The amended PPA is subject to regulatory approval.

In March 2003, the office of the Federal Public Prosecutor for the State of São Paulo, Brazil (“MPF”) notified Eletropaulo that it had commenced an inquiry related to the BNDES financings provided to AES Elpa and AES Transgás and the rationing loan provided to Eletropaulo, changes in the control of Eletropaulo, sales of assets by Eletropaulo and the quality of service provided by Eletropaulo to its customers, and requested various documents from Eletropaulo relating to these matters. In July 2004, the MPF filed a public civil lawsuit in the Federal Court of São Paulo (“FCSP”) alleging that BNDES violated Law 8429/92 (the Administrative

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Misconduct Act) and BNDES’s internal rules by: (1) approving the AES Elpa and AES Transgás loans; (2) extending the payment terms on the AES Elpa and AES Transgás loans; (3) authorizing the sale of Eletropaulo’s preferred shares at a stock-market auction; (4) accepting Eletropaulo’s preferred shares to secure the loan provided to Eletropaulo; and (5) allowing the restructurings of Light Serviços de Eletricidade S.A. and Eletropaulo. The MPF also named AES Elpa and AES Transgás as defendants in the lawsuit because they allegedly benefited from BNDES’s alleged violations. In May 2006, the FCSP ruled that the MPF could pursue its claims based on the first, second, and fourth alleged violations noted above. The MPF subsequently filed an interlocutory appeal with the Federal Court of Appeals (“FCA”) seeking to require the FCSP to consider all five alleged violations. Also, in July 2006, AES Elpa and AES Transgás filed an interlocutory appeal with the FCA, which was subsequently consolidated with the MPF’s interlocutory appeal, seeking a transfer of venue and to enjoin the FCSP from considering any of the alleged violations. In June 2009, the FCA granted the injunction sought by AES Elpa and AES Transgás and transferred the case to the Federal Court of Rio de Janeiro. In May 2010, the MPF filed an appeal with the Superior Court of Justice (“SCJ”) challenging the transfer. In November 2012, the SCJ ruled that the lawsuit must be returned to the FCSP. AES Elpa and AES Brasiliana (the successor of AES Transgás) believe they have meritorious defenses to the allegations asserted against them and will defend themselves vigorously in these proceedings; however, there can be no assurances that they will be successful in their efforts.

AES Florestal, Ltd. (“Florestal”), had been operating a pole factory and had other assets, including a wooded area known as “Horto Renner,” in the State of Rio Grande do Sul, Brazil (collectively, “Property”). Florestal had been under the control of AES Sul (“Sul”) since October 1997, when Sul was created pursuant to a privatization by the Government of the State of Rio Grande do Sul. After it came under the control of Sul, Florestal performed an environmental audit of the entire operational cycle at the pole factory. The audit discovered 200 barrels of solid creosote waste and other contaminants at the pole factory. The audit concluded that the prior operator of the pole factory, Companhia Estadual de Energia Elétrica (“CEEE”), had been using those contaminants to treat the poles that were manufactured at the factory. Sul and Florestal subsequently took the initiative of communicating with Brazilian authorities, as well as CEEE, about the adoption of containment and remediation measures. The Public Attorney’s Office has initiated a civil inquiry (Civil Inquiry n. 24/05) to investigate potential civil liability and has requested that the police station of Triunfo institute a police investigation (IP number 1041/05) to investigate potential criminal liability regarding the contamination at the pole factory. The parties filed defenses in response to the civil inquiry. The Public Attorney’s Office then requested an injunction which the judge rejected on September 26, 2008, and the Public Attorney’s office no longer has a right to appeal the decision. The environmental agency (“FEPAM”) has also started a procedure (Procedure n. 088200567/059) to analyze the measures that shall be taken to contain and remediate the contamination. Also, in March 2000, Sul filed suit against CEEE in the 2nd Court of Public Treasure of Porto Alegre seeking to register in Sul’s name the Property that it acquired through the privatization but that remained registered in CEEE’s name. During those proceedings, AES subsequently waived its claim to re-register the Property and asserted a claim to recover the amounts paid for the Property. That claim is pending. In November 2005, the 7th Court of Public Treasure of Porto Alegre ruled that the Property must be returned to CEEE. CEEE has had sole possession of Horto Renner since September 2006 and of the rest of the Property since April 2006. In February 2008, Sul and CEEE signed a “Technical Cooperation Protocol” pursuant to which they requested a new deadline from FEPAM in order to present a proposal. In March 2008, the State Prosecution office filed a Class Action against AES Florestal, AES Sul and CEEE, requiring an injunction for the removal of the alleged sources of contamination and the payment of an indemnity in the amount of R$6 million ($3 million). The injunction was rejected. The above-referenced proposal to FEPAM with respect to containing and remediating the contamination was delivered on April 8, 2008. FEPAM responded by indicating that the parties should undertake the first step of the proposal which would be to retain a contractor. In its response, Sul indicated that such step should be undertaken by CEEE as the relevant environmental events resulted from CEEE’s operations. In October 2011, the State Prosecution Office presented a new request to the court of Triunfo for an injunction against Florestal, Sul and CEEE for the removal of the alleged sources of contamination and remediation, and the court granted the injunction against CEEE but did not grant injunctive relief against Florestal or Sul. CEEE appealed such decision, and the State of Rio Grande do Sul Court of Appeals upheld the decision. As required by

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the injunction, CEEE has started the removal and disposal of the contaminants, which is ongoing, and Sul is not at risk to bear any of such remediation costs, which are estimated to be approximately R$49.0 million ($24 million). In November 2012, the inspections performed by the court expert and supervised by Sul confirmed that CEEE is fulfilling the injunction by removing the contaminants. The case is in the evidentiary stage awaiting the production of the court’s expert opinion on several matters, including which of the parties had utilized the products found in the area.

In January 2004, the Company received notice of a “Formulation of Charges” filed against the Company by the Superintendence of Electricity of the Dominican Republic. In the “Formulation of Charges,” the Superintendence asserts that the existence of three generation companies (Empresa Generadora de Electricidad Itabo, S.A. (“Itabo”), Dominican Power Partners, and AES Andres BV) and one distribution company (Empresa Distribuidora de Electricidad del Este, S.A. (“Este”)) in the Dominican Republic, violates certain cross-ownership restrictions contained in the General Electricity Law of the Dominican Republic. In February 2004, the Company filed in the First Instance Court of the National District of the Dominican Republic an action seeking injunctive relief based on several constitutional due process violations contained in the “Formulation of Charges” (“Constitutional Injunction”). In February 2004, the Court granted the Constitutional Injunction and ordered the immediate cessation of any effects of the “Formulation of Charges,” and the enactment by the Superintendence of Electricity of a special procedure to prosecute alleged antitrust complaints under the General Electricity Law. In March 2004, the Superintendence of Electricity appealed the Court’s decision. In July 2004, the Company divested any interest in Este. The Superintendence of Electricity’s appeal remains pending. The Company believes it has meritorious defenses to the claims asserted against it and will defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

In February 2008, the Native Village of Kivalina and the City of Kivalina, Alaska, filed a complaint in the U.S. District Court for the Northern District of California against the Company and numerous unrelated companies, claiming that the defendants’ alleged GHG emissions have contributed to alleged global warming which, in turn, allegedly has led to the erosion of the plaintiffs’ alleged land. The plaintiffs assert nuisance and concert of action claims against the Company and the other defendants, and a conspiracy claim against a subset of the other defendants. The plaintiffs seek to recover relocation costs, indicated in the complaint to be from $95 million to $400 million, and other unspecified damages from the defendants. The Company filed a motion to dismiss the case, which the District Court granted in October 2009. The plaintiffs appealed to the U.S. Court of Appeals for the Ninth Circuit. In September 2012, the Ninth Circuit affirmed the District Court’s decision. The plaintiffs’ subsequent petition for en banc review was denied by the Ninth Circuit. The plaintiffs have filed a petition requesting review by the Supreme Court, which the defendants have opposed. The Company believes it has meritorious defenses to the claims asserted against it and will defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

In March 2009, AES Uruguaiana Empreendimentos S.A. (“AESU”) in Brazil initiated arbitration in the International Chamber of Commerce (“ICC”) against YPF S.A. (“YPF”) seeking damages and other relief relating to YPF’s breach of the parties’ gas supply agreement (“GSA”). Thereafter, in April 2009, YPF initiated arbitration in the ICC against AESU and two unrelated parties, Companhia de Gas do Esado do Rio Grande do Sul and Transportador de Gas del Mercosur S.A. (“TGM”), claiming that AESU wrongfully terminated the GSA and caused the termination of a transportation agreement (“TA”) between YPF and TGM (“YPF Arbitration”). YPF seeks an unspecified amount of damages from AESU, a declaration that YPF’s performance was excused under the GSA due to certain alleged force majeure events, or, in the alternative, a declaration that the GSA and the TA should be terminated without a finding of liability against YPF because of the allegedly onerous obligations imposed on YPF by those agreements. In addition, in the YPF Arbitration, TGM asserts that if it is determined that AESU is responsible for the termination of the GSA, AESU is liable for TGM’s alleged losses, including losses under the TA. In April 2011, the arbitrations were consolidated into a single proceeding. The hearing on liability issues took place in December 2011, and thereafter the arbitrators took those issues under consideration. AESU believes it has meritorious claims and defenses and will assert them vigorously; however, there can be no assurances that it will be successful in its efforts.

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In April 2009, the Antimonopoly Agency in Kazakhstan initiated an investigation of the power sales of Ust-Kamenogorsk HPP (“UK HPP”) and Shulbinsk HPP, hydroelectric plants under AES concession (collectively, the “Hydros”), for the period from January through February 2009. The Antimonopoly Agency determined that the Hydros abused their market position and charged monopolistically high prices for power from January through February 2009. The Agency sought an order from the administrative court requiring UK HPP to pay an administrative fine of approximately KZT 120 million ($1 million) and to disgorge profits for the period at issue, estimated by the Antimonopoly Agency to be approximately KZT 440 million ($3 million). No fines or damages have been paid to date, however, as the proceedings in the administrative court have been suspended due to the initiation of related criminal proceedings against officials of the Hydros. In the course of criminal proceedings, the financial police have expanded the periods at issue to the entirety of 2009 in the case of UK HPP and from January through October 2009 in the case of Shulbinsk HPP, and sought increased damages of KZT 1.2 billion ($8 million) from UK HPP and KZT 1.3 billion ($8 million) from Shulbinsk HPP. The Hydros believe they have meritorious defenses and will assert them vigorously in these proceedings; however, there can be no assurances that they will be successful in their efforts.

In October 2009, AES Mérida III, S. de R.L. de C.V. (AES Mérida), one of our businesses in Mexico, initiated arbitration against its fuel supplier and electricity offtaker, Comisión Federal de Electricidad (“CFE”), seeking a declaration that CFE breached the parties’ power purchase agreement (“PPA”) by supplying gas that did not comply with the PPA’s specifications. Alternatively, AES Mérida requested a declaration that the supply of such gas by CFE is a force majeure event under the PPA. CFE disputed the claims. Although it did not assert counterclaims, in its closing brief CFE asserted that it is entitled to a partial refund of the capacity charge payments that it made for power generated with the out-of-specification gas. In July 2012, the arbitral Tribunal issued an award in AES Mérida’s favor. In December 2012, CFE initiated an action in Mexican court seeking to nullify the award. AES Mérida has opposed the request and asserted a counterclaim to confirm the award. AES Mérida believes it has meritorious defenses in that action; however, there can be no assurances that it will be successful.

In October 2009, IPL received a Notice of Violation (“NOV”) and Finding of Violation from the EPA pursuant to the Clean Air Act (“CAA”) Section 113(a). The NOV alleges violations of the CAA at IPL’s three primarily coal-fired electric generating facilities dating back to 1986. The alleged violations primarily pertain to the Prevention of Significant Deterioration and nonattainment New Source Review (“NSR”) requirements under the CAA. Since receiving the letter, IPL management has met with EPA staff regarding possible resolutions of the NOV. At this time, we cannot predict the ultimate resolution of this matter. However, settlements and litigated outcomes of similar cases have required companies to pay civil penalties, install additional pollution control technology on coal-fired electric generating units, retire existing generating units, and invest in additional environmental projects. A similar outcome in this case could have a material impact to IPL and could, in turn, have a material impact on the Company. IPL would seek recovery of any operating or capital expenditures related to air pollution control technology to reduce regulated air emissions; however, there can be no assurances that it would be successful in that regard.

In November 2009, April 2010, December 2010, April 2011, June 2011, August 2011, and November 2011, substantially similar personal injury lawsuits were filed by a total of 49 residents and decedent estates in the Dominican Republic against the Company, AES Atlantis, Inc., AES Puerto Rico, LP, AES Puerto Rico, Inc., and AES Puerto Rico Services, Inc., in the Superior Court for the State of Delaware. In each lawsuit, the plaintiffs allege that the coal combustion byproducts of AES Puerto Rico’s power plant were illegally placed in the Dominican Republic from October 2003 through March 2004 and subsequently caused the plaintiffs’ birth defects, other personal injuries, and/or deaths. The plaintiffs did not quantify their alleged damages, but generally alleged that they are entitled to compensatory and punitive damages and the Company is not able to estimate damages, if any, at this time. The AES defendants moved for partial dismissal of both the November 2009 and April 2010 lawsuits on various grounds. In July 2011, the Superior Court dismissed the plaintiffs’ international law and punitive damages claims, but held that the plaintiffs had stated intentional tort, negligence, and strict liability claims under Dominican law, which the Superior Court found governed the lawsuits. The Superior Court

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granted the plaintiffs leave to amend their complaints in accordance with its decision, and in September 2011, the plaintiffs in the November 2009 and April 2010 lawsuits did so. The AES defendants again moved for partial dismissal of those amended complaints, and in May 2012, the Superior Court ruled on the motion in the November 2009 lawsuit, dismissing the plaintiffs’ claims for future medical monitoring expenses but declining to dismiss their claims under Dominican Republic Law 64-00. The Superior Court has not yet ruled on the motion for partial dismissal of the April 2010 lawsuit. The AES defendants filed an answer to the November 2009 lawsuit in June 2012. The Superior Court has stayed the remaining six lawsuits, as well as any subsequently filed similar lawsuits. The Superior Court has also ordered that, for the present, discovery will proceed only in the November 2009 lawsuit and will be limited to causation and exposure issues. The AES defendants believe they have meritorious defenses and will defend themselves vigorously; however, there can be no assurances that they will be successful in their efforts.

On December 21, 2010, AES-3C Maritza East 1 EOOD, which owns a 670 MW lignite-fired power plant in Bulgaria, made the first in a series of demands on the performance bond securing the construction Contractor’s obligations under the parties’ EPC Contract. The Contractor failed to complete the plant on schedule. The total amount demanded by Maritza under the performance bond was approximately €155 million. The Contractor obtained an injunction from a lower French court purportedly preventing the issuing bank from honoring the bond demands. However, the Versailles Court of Appeal canceled the injunction in July 2011, and therefore the issuing bank paid the bond demands in full. In addition, in December 2010, the Contractor stopped commissioning of the power plant’s two units, allegedly because of the purported characteristics of the lignite supplied to it for commissioning. In January 2011, the Contractor initiated arbitration on its lignite claim, seeking an extension of time to complete the power plant, an increase to the contract price, and other relief, including in relation to the bond demands. The Contractor later added claims relating to the alleged unavailability of the grid during commissioning. Maritza rejected the Contractor’s claims and asserted counterclaims for delay liquidated damages and other relief relating to the Contractor’s failure to complete the power plant and other breaches of the EPC Contract. Maritza also terminated the EPC Contract for cause and asserted arbitration claims against the Contractor relating to the termination. The Contractor asserted counterclaims relating to the termination. The Contractor is seeking approximately €240 million ($308 million) in the arbitration, unspecified damages for alleged injury to reputation, and other relief. The arbitral hearing on the merits is scheduled for November 25-December 6, 2013 and January 6-17, 2014. Maritza believes it has meritorious claims and defenses and will assert them vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

On February 11, 2011 AES Eletropaulo received a notice of violation from São Paulo State’s Environmental Authorities for allegedly destroying 0.32119 hectares of native vegetation at the Conservation Park of Serra do Mar (“Park”), without previous authorization or license. The notice of violation asserted a fine of approximately R$1 million ($516,436) and the suspension of AES Eletropaulo activities in the Park. As a response to this administrative procedure before the São Paulo State Environmental Authorities (“São Paulo EA”), AES Eletropaulo timely presented its defense on February 28, 2011 seeking to vacate the notice of violation or reduce the fine. In December 2011, the São Paulo EA declined to vacate the notice of violation but recognized the possibility of 40% reduction in the fine if AES Eletropaulo agrees to recover the affected area with additional vegetation. AES Eletropaulo has not appealed the decision and is now discussing the terms of a possible settlement with the São Paulo EA, including a plan to recover the affected area by primarily planting additional trees. In March 2012, the State of São Paulo Prosecutor’s Office of São Bernando do Campo initiated a Civil Proceeding to review the compliance by AES Eletropaulo with the terms of any possible settlement. AES Eletropaulo has had several meetings and field inspections to settle the details of the recovery project. AES Eletropaulo is currently awaiting the approval of the recovery project by the Park Administrator.

In May 2011, a putative class action was filed in the Mississippi federal court against the Company and numerous unrelated companies. The lawsuit alleges that greenhouse gas emissions contributed to alleged global warming which, in turn, allegedly increased the destructive capacity of Hurricane Katrina. The plaintiffs assert claims for public and private nuisance, trespass, negligence, and declaratory judgment. The plaintiffs seek

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damages relating to loss of property, loss of business, clean-up costs, personal injuries and death, but do not quantify their alleged damages. The Company is unable to estimate the alleged damages at this time. These and other plaintiffs previously brought a substantially similar lawsuit in the federal court but failed to obtain relief. In October 2011, the Company and other defendants filed motions to dismiss the lawsuit. In March 2012, the federal court granted the motion and dismissed the lawsuit. The plaintiffs appealed to the U.S. Court of Appeals for the Fifth Circuit. The appeal is fully briefed and oral argument occurred on May 1, 2013. The Company believes it has meritorious defenses and will defend itself vigorously in this lawsuit; however, there can be no assurances that it will be successful in its efforts.

In February 2011, a consumer protection group, S.O.S. Consumidores (“SOSC”), filed a lawsuit in the State of Săo Paulo Federal Court against Eletropaulo and all other distribution companies in the State of Săo Paulo, claiming that the distribution companies had overcharged customers for electricity. SOSC asserts that the distribution companies’ tariffs had been incorrectly calculated by the Brazilian Regulatory Agency (“ANEEL”). ANEEL corrected the alleged error in May 2010. There are separate proceedings against ANEEL to determine whether the tariffs had been properly calculated. SOSC has moved for an injunction requiring tariffs to be corrected from the effective dates of the relevant concession contracts. Electropaulo has opposed that request on the ground that it did not wrongfully collect amounts from its customers, since its tariff was calculated in accordance with the concession contract with the Federal Government and ANEEL’s rules. At ANEEL’s request, the Superior Court of Justice has suspended the lawsuit and similar cases against third parties and determined that all such cases shall be transferred to the Federal Court of Belo Horizonte. If Eletropaulo does not prevail in the lawsuit, Eletropaulo estimates that its liability to customers could be approximately R$855 million ($422 million). Electropaulo believes it has meritorious defenses and will defend itself vigorously in this lawsuit; however, there can be no assurances that it will be successful in its efforts.

In June 2011, the São Paulo Municipal Tax Authority (the “Municipality”) filed 60 tax assessments in São Paulo administrative court against Eletropaulo, seeking approximately R$1.2 billion ($593 million) in services tax (“ISS”) that allegedly had not been collected on revenues for services rendered by Eletropaulo. Eletropaulo estimates that, with interest, the amount at issue has increased to approximately R$1.9 billion ($1.0 billion). Eletropaulo has challenged the assessments on the ground that the revenues at issue were not subject to ISS. Eletropaulo believes it has meritorious defenses to the assessments and will defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

In August 2012, Fondo Patrimonial de las Empresas Reformadas (“FONPER”) (the Dominican instrumentality that holds the Dominican Republic’s shares in Empresa Generadora de Electricidad Itabo, S.A. (“Itabo”)) filed a criminal complaint against certain current and former employees of AES. The criminal proceedings include a related civil component initiated against Coastal Itabo, Ltd. (“Coastal”) (the AES affiliate shareholder of Itabo) and New Caribbean Investment, S.A. (“NCI”) (the AES affiliate that manages Itabo). FONPER asserts claims relating to the alleged mismanagement of Itabo and seeks approximately $270 million in damages. The Dominican District Attorney (“DA”) has admitted the criminal complaint and is investigating the allegations set forth therein. In September 2012, one of the individual defendants responded to the criminal complaint, denying the charges and seeking an immediate dismissal of same. In April 2013, the DA requested that the Dominican Camara de Cuentas perform an audit of the allegations in the criminal complaint. Further, in August 2012, Coastal and NCI initiated an international arbitration proceeding against FONPER and the Dominican Republic, seeking a declaration that Coastal and NCI have acted both lawfully and in accordance with the relevant contracts with FONPER and the Dominican Republic in relation to the management of Itabo. Coastal and NCI also seek a declaration that the criminal complaint is a breach of the relevant contracts between the parties, including the obligation to arbitrate disputes. Coastal and NCI further seek damages from FONPER and the Dominican Republic resulting from their breach of contract. FONPER and the Dominican Republic have denied the claims. The AES defendants believe they have meritorious claims and defenses, which they will assert vigorously; however there can be no assurance that they will be successful in their efforts.

In March 2013, an arbitral Tribunal issued a “Partial Final Award” and thereafter a “Revised Partial Final Award” (the “Award”), ordering a wind subsidiary of the Company to pay a net amount of approximately $17

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million to its EPC Contractor. The arbitration is ongoing, and the Contractor and certain of its subcontractors have asserted additional claims seeking interest, fees, and costs totaling approximately $13 million, as well as relief relating to certain liens. Also, there are judicial proceedings concerning the Award and a guaranty issued to the Contractor by another wind subsidiary of the Company. The wind subsidiaries will assert their respective defenses and claims vigorously; however, there can be no assurances that they will prevail.

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ITEM 1A.    RISK FACTORS

There have been no material changes to the risk factors as previously disclosed in our 2012 Form 10-K under Part 1 — Item 1A. — Risk Factors.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.    MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.    OTHER INFORMATION

None.

ITEM 6.    EXHIBITS

4.1	Sixteenth Supplemental Indenture, dated April 30, 2013 between The AES Corporation and Wells Fargo Bank, N.A. as Trustee is incorporated herein by reference to Exhibit 4.1 of the Company’s Form 8-K filed on April 30, 2013.
10.1	Amendment No. 1, dated February 27, 2013, to the Credit Agreement dated as of May 27, 2011 among The AES Corporation, as borrower, the banks listed therein and Bank of America, N.A., as administrative agent (filed herewith).
31.1	Rule13a-14(a)/15d-14(a) Certification of Andrés Gluski (filed herewith).
31.2	Rule 13a-14(a)/15d-14(a) Certification of Thomas M. O’Flynn (filed herewith).
32.1	Section 1350 Certification of Andrés Gluski (filed herewith).
32.2	Section 1350 Certification of Thomas M. O’Flynn (filed herewith).
101.INS	XBRL Instance Document (filed herewith).
101.SCH	XBRL Taxonomy Extension Schema Document (filed herewith).
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith).
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document (filed herewith).
101.LAB	XBRL Taxonomy Extension Label Linkbase Document (filed herewith).
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	THE AES CORPORATION (Registrant)
Date: May 8, 2013	By:	/s/ THOMAS M. O’FLYNN
		Name:	Thomas M. O’Flynn
		Title:	Executive Vice President and Chief Financial Officer (Principal Financial Officer)
	By:	/s/ MICHAEL RAMBERG
		Name:	Michael Ramberg
		Title:	Vice President and Interim Controller (Principal Accounting Officer)

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EX-10.1

Exhibit 10.1

AMENDMENT No. 1

AMENDMENT No. 1, dated as of February 27, 2013 (this “Amendment”), in respect of the Credit Agreement (as amended and restated, supplemented or otherwise modified from time to time) (the “Credit Agreement”), dated as of May 27, 2011, among The AES Corporation, as Borrower, the Banks party thereto from time to time and Bank of America, N.A., as agent.

WHEREAS, Borrower desires, pursuant to Section 2.16 of the Credit Agreement, to obtain Credit Agreement Refinancing Indebtedness in respect of all of the Term Loans outstanding under the Credit Agreement made on the Closing Date and outstanding on the date hereof (the “Existing Term Loans”), and to prepay in full such Existing Term Loans and all other Obligations in respect thereof on the Amendment Effective Date; and

WHEREAS, Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated are the joint lead arrangers for the Amendment; and

WHEREAS, the 2013 Other Term Loan Banks (as defined below) have agreed to provide such Credit Agreement Refinancing Indebtedness in the form of Other Term Loans, in accordance with the terms and conditions set forth herein and in the Credit Agreement; and

WHEREAS, the transactions contemplated hereby constitute a prepayment of the Existing Term Loans pursuant to Section 2.10(a)(i) of the Credit Agreement; and

WHEREAS, the Borrower and the Required Banks have agreed to amend the Credit Agreement as hereinafter provided;

NOW, THEREFORE, the parties hereto agree as follows:

Section 1. Defined Terms; References. (a) Unless otherwise specifically defined herein, each term used herein which is defined in the Credit Agreement has the meaning assigned to such term in the Credit Agreement. Each reference to “hereof”, “hereunder”, “herein” and “hereby” and each other similar reference and each reference to “this Agreement” and each other similar reference contained in the Credit Agreement shall, after the Amendment Effective Date, refer to the Credit Agreement as amended hereby.

(b) As used in this Amendment, the following terms have the meanings specified below:

“Amendment Effective Date” shall have the meaning assigned to such term in Section 8 hereof.

“Existing Term Loan Bank” shall mean a Term Loan Bank with an Existing Term Loan on the Amendment Effective Date, immediately prior to giving effect to this Amendment.

“Existing Term Loan Prepayment Amount” shall mean, for each Existing Term Loan Bank, the sum of (i) the aggregate principal amount of Existing Term Loans owing to such Existing Term Loan Bank on the Amendment Effective Date (other than in respect of any Existing Term Loan in respect of which the Existing Term Loan Bank has agreed in a written notice to the Agent to exchange for a 2013 Other Term Loan in the same principal amount) plus (ii) all accrued and unpaid interest on such Existing Term Loan Bank’s Existing Term Loans to the Amendment Effective Date plus (iii) any other amounts owing to such Existing Term Loan Bank (in its capacity as such) under the Financing Documents as of the Amendment Effective Date (including any amounts under Section 2.12).

Section 2. Amendment Effective Date Transactions; Terms of the Other Term Loans.

(a) With effect from and including the Amendment Effective Date, each Person identified on the signature pages hereof as a “2013 Other Term Loan Bank” (each, a “2013 Other Term Loan Bank”) shall (i) become party to the Credit Agreement as a “Bank,” a “Term Loan Bank,” an “Other Term Loan Bank” (so long as such Person is not an Existing Term Loan Bank) and an “Additional Term Loan Bank,” (ii) have an Other Term Commitment in the amount set forth on Schedule 1 hereto (its “2013 Other Term Commitment”) and (iii) have all of the rights and obligations of a “Bank,” a “Term Loan Bank,” an “Other Term Loan Bank,” an “Additional Term Loan Bank” and a “Bank Party” under the Credit Agreement and the other Financing Documents.

(b) On the Amendment Effective Date, each Existing Term Loan Bank (in its capacity as such, but not in any other capacity) shall cease to be a Bank party to the Credit Agreement (and, for the avoidance of doubt, shall not be a Term Loan Bank party to the Credit Agreement (except to the extent that it is a 2013 Other Term Loan Bank or shall subsequently become a Term Loan Bank party thereto pursuant to an assignment and assumption entered into in accordance with the terms of the Credit Agreement)), and all accrued fees and other amounts payable under the Credit Agreement for the account of each Existing Term Loan Bank shall be due and payable on such date; provided that the provisions of Sections 8.03, 8.04 and 10.03 of the Credit Agreement shall continue to inure to the benefit of each Existing Term Loan Bank after the Amendment Effective Date.

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(c) On the Amendment Effective Date:

(I) Each 2013 Other Term Loan Bank, severally and not jointly, shall make an Other Term Loan (a “2013 Other Term Loan”) to Borrower in accordance with this Section 2(c) and Section 2.02 of the Credit Agreement by delivering to the Agent immediately available funds in an amount equal to its 2013 Other Term Commitment (other than any 2013 Other Term Loan Bank which (i) is also an Existing Term Loan Bank and (ii) has agreed by written notice to the Agent to exchange its Existing Term Loan for a 2013 Other Term Loan in the same principal amount);

(II) Borrower shall prepay in full the Existing Term Loans by:

(A) delivering to the Agent an amount equal to the excess of (1) the aggregate of the Existing Term Loan Prepayment Amounts for all of the Existing Term Loan Banks over (2) the aggregate amount of the 2013 Other Term Commitments (such excess, the “Borrower’s Payment”); and

(B) directing the Agent to apply the funds made available to the Agent pursuant to Section 2(c)(I) hereof (the “Bank Funding Amount”), along with the Borrower’s Payment to prepay in full the Existing Term Loans (other than any Existing Term Loan in respect of which the Existing Term Loan Bank has agreed by written notice to the Agent to exchange for a 2013 Other Term Loan in the same principal amount); and

(III) The Agent shall apply the Bank Funding Amount and the Borrower’s Payment to pay to each Existing Term Loan Bank an amount equal to such Existing Term Loan Bank’s Existing Term Loan Prepayment Amount; and

(IV) The transactions described in the preceding clauses (I), (II) and (III) shall be deemed to occur immediately prior to the effectiveness of the amendment of the Credit Agreement pursuant to Section 3 hereof.

(d) Each 2013 Other Term Loan made on the Amendment Effective Date pursuant to Section 2(c) shall constitute, at the option of the Borrower, either Base Rate Loans or Eurodollar Loans with an initial Interest Period of one month as set forth in the Notice of Borrowing with respect to the 2013 Other Term Loans pursuant to Section 2.02 of the Credit Agreement.

(e) The “Base Rate Margin” and the “Eurodollar Margin” with respect to the 2013 Other Term Loans shall be determined as set forth on Schedule 2 hereto. The “Eurodollar Rate” floor shall be as specified on Schedule 2 hereto.

3

(f) All 2013 Other Term Loans shall mature and be due and payable in full on June 1, 2018 (the “2013 Other Term Loan Termination Date”).

(g) In the event that, on or prior to the first anniversary of the Amendment Effective Date, Borrower (x) makes any prepayment of 2013 Other Term Loans in connection with any Repricing Transaction or (y) effects any amendment to the Credit Agreement or this Amendment resulting in a Repricing Transaction with respect to the 2013 Other Term Loans, the Borrower shall pay to the Agent, for the ratable account of each of the applicable Banks, (I) in the case of clause (x), a prepayment premium of 1% of the amount of the 2013 Other Term Loans being prepaid and (II) in the case of clause (y), an amount equal to 1% of the aggregate amount of the applicable 2013 Other Term Loans outstanding immediately prior to such amendment that were repriced pursuant to such amendment.

(h) The 2013 Other Term Commitments provided for hereunder shall terminate on the Amendment Effective Date immediately upon the borrowing of the 2013 Other Term Loans pursuant to Section 2(c).

Section 3. Amendment of Credit Agreement.

(a) Each of the parties hereto agrees that, effective on the Amendment Effective Date, the Credit Agreement shall be amended to delete the stricken text (indicated textually in the same manner as the following example:) and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in the pages of the Credit Agreement attached as Exhibit A hereto (the “Amendments”).

(b) With effect from the Amendment Effective Date and as provided in the Amendments, each 2013 Other Term Loan made on the Amendment Effective Date in accordance with Section 2 hereof shall constitute, for all purposes of the Credit Agreement, a “Term Loan” made pursuant to the Credit Agreement and this Amendment, and all provisions of the Credit Agreement applicable to Term Loans shall be applicable to such 2013 Other Term Loans.

(c) It is understood and agreed that immediately following the consummation of the transactions described in Section 2, the 2013 Other Term Loan Banks, by execution of this Amendment, hereby consent to the Amendments and constitute the Required Banks and the Amendments shall become effective immediately following the consummation of the transactions described in Section 2.

Section 4. Effect of Amendment; Reaffirmation; Etc. (a) Except as expressly set forth herein or in the Credit Agreement, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise

4

affect the rights and remedies of the Banks or the Agent Parties under the Credit Agreement or under any other Financing Document and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other provision of the Credit Agreement or of any other Financing Document, all of which are ratified and affirmed in all respects and shall continue in full force and effect. Without limiting the foregoing, (i) each of Borrower and AES BVI II acknowledges and agrees that (A) each Financing Document to which it is a party is hereby confirmed and ratified and shall remain in full force and effect according to its respective terms (in the case of the Credit Agreement, as amended pursuant to the Amendments) and (B) the Collateral Documents do, and all of the Collateral does, and in each case shall continue to, secure the payment of all Secured Obligations (including, for the avoidance of doubt, the 2013 Other Term Loans made on the Amendment Effective Date) on the terms and conditions set forth in the Collateral Documents, and hereby ratifies the security interests granted by it pursuant to the Collateral Documents and (ii) each of Borrower and AES BVI II hereby confirms and ratifies its continuing unconditional obligations under the Financing Documents with respect to all of the Secured Obligations (including, for the avoidance of doubt, the 2013 Other Term Loans made on the Amendment Effective Date).

(b) This Amendment constitutes a “Refinancing Amendment,” the 2013 Other Term Loans constitute “Other Term Loans,” “Credit Agreement Refinancing Indebtedness,” “Loans” and “Term Loans” and the commitments of the 2013 Other Term Loans Banks hereunder to make 2013 Other Term Loans constitute “Other Term Commitments”, in each case as such terms are used and defined in the Credit Agreement. From and after the Amendment Effective Date, this Amendment shall be a Financing Document.

Section 5. Representations of the Borrower. The Borrower hereby represents and warrants that, immediately prior to and immediately after giving effect to the transactions contemplated by this Amendment, including the borrowing of the 2013 Other Term Loans provided for herein and the Amendments:

(a) the representations and warranties set forth in Article IV of the Credit Agreement and in each other Financing Document shall be true and correct in all material respects on and as of the Amendment Effective Date with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (other than with respect to Section 4.16 thereof which shall be true and correct in all material respects on and as of the Amendment Effective Date with the same effect as though made on and as of such date), in which case they shall be true and correct in all material respects as of such earlier date; provided, that any such

5

representation and warranty that is qualified by “materiality”, “material adverse effect” or similar language shall be true and correct in all respects (after giving effect to such qualification therein) on and as of the Amendment Effective Date with the same effect as though made on and as of such date or such earlier date, as applicable;

(b) The Borrower has full power and authority, and has taken all action necessary, to execute and deliver this Amendment and to consummate the transactions contemplated hereby and neither its execution and delivery of this Amendment nor the consummation of the transaction contemplated hereby conflict with the Borrower’s organizational documents or material contracts or with any applicable law; and

(c) no Default shall exist or would result from the transactions contemplated by this Amendment, including the borrowing of the 2013 Other Term Loans and the Amendments.

Section 6. Governing Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

Section 7. Counterparts. This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original but all of which when taken together shall constitute a single contract. Delivery of an executed signature page to this Amendment by facsimile or electronic transmission shall be as effective as delivery of a manually signed counterpart of this Amendment.

Section 8. Effectiveness. This Amendment shall become effective on the date (the “Amendment Effective Date”) when each of the following conditions shall have been satisfied:

(a) the Agent shall have received from each of Borrower and AES BVI II, the Agent and each 2013 Other Term Loan Bank either (i) a counterpart of the Amendment signed on behalf of such party or (ii) written evidence satisfactory to the Agent (which may include telecopy or electronic transmission of a signed signature page of the Amendment) that such party has signed a counterpart of the Amendment;

(b) Borrower shall have paid all fees due and payable to Citigroup Global Markets Inc. and the other lead arrangers pursuant to that certain fee letter, dated as of February 26, 2013, among the Borrower, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Citigroup Global Markets Inc.;

6

(c) the Agent shall have received all fees and expenses due and payable on or prior to the Amendment Effective Date under the Existing Credit Agreement or any other Financing Document, including, to the extent invoiced at least two Business Days prior to the Amendment Effective Date (except as otherwise reasonably agreed by Borrower), reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by Borrower under the Credit Agreement or any other Financing Document;

(d) the aggregate amount of the 2013 Other Term Commitments shall be equal to $806,625,000;

(e) the Agent shall have received from Borrower the Borrower’s Payment;

(f) the Agent and each 2013 Other Term Loan Bank shall have received on or prior to the Amendment Effective Date, all documentation and other information about Borrower required under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the USA PATRIOT Act, that has been requested in writing at least 5 Business Days prior to the Amendment Effective Date;

(g) the representations and warranties set forth in Section 5 of this Amendment shall be true and correct in all material respects; and

(h) the Agent shall have received:

(I) a certificate as to the good standing (where relevant) of the Borrower as of a recent date, from the Secretary of State of the state of its organization or similar governmental authority;

(II) a true and complete copy of resolutions duly adopted by the board of directors (or equivalent governing body) of the Borrower authorizing the execution, delivery and performance of this Amendment, including, the borrowing of the 2013 Other Term Loans contemplated under this Amendment; and

(III) an opinion of Davis Polk & Wardwell LLP, counsel for the Borrower, in form and substance reasonably satisfactory to the Agent, as to such matters as the Agent shall reasonably request,

in each of cases (I) – (III) (to the extent applicable), substantially consistent with those delivered on the Closing Date pursuant to Section 3.01 of the Credit Agreement (other than changes to such legal opinion resulting from a change in law, change in fact or change to counsel’s form of opinion reasonably satisfactory to the Agent).

7

It shall be a further condition precedent (x) to the effectiveness of this Amendment and to the obligation of each 2013 Other Term Loan Bank to make the 2013 Other Term Loans to be made by it pursuant to Section 2(c)(I) that the conditions set forth in Section 3.02 of the Credit Agreement shall be satisfied on the Amendment Effective Date (including delivery of a Notice of Borrowing pursuant to Section 2.02 of the Credit Agreement) and (y) to the effectiveness of the Amendments that the Bank Funding Amount shall have been received and all payments contemplated by Section 2(c)(III) shall have been made.

[SIGNATURE PAGES FOLLOW]

8

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the day and year first above written.

Borrower:
THE AES CORPORATION
By:	/s/ Willard C. Hoagland III
	Name: Willard C. Hoagland III
	Title: Vice President and Treasurer

SIGNATURE PAGE TO AMENDMENT

Grantor:
AES INTERNATIONAL HOLDINGS II, LTD.
By:	/s/ Kazi Hasan
	Name: Kazi Hasan
	Title: President

SIGNATURE PAGE TO AMENDMENT

BANK OF AMERICA, N.A., as Agent
By	/s/ Maria A. McClain
	Name: Maria A. McClain
	Title: Vice President

SIGNATURE PAGE TO AMENDMENT

2013 Other Term Loan Bank:

By executing this signature page, the institution referred to below hereby consents to the terms of the Amendment to which this signature page is attached and elects to become a 2013 Other Term Loan Bank with a 2013 Other Term Commitment in the amount set out in Schedule 1 on the Amendment Effective Date.

CITIBANK, N.A., as Bank
By:	/s/ Kirkwood Roland
	Name: Kirkwood Roland
	Title: Director & Vice President

SIGNATURE PAGE TO AMENDMENT

Schedule 1

2013 Other Term Commitments

Bank	2013 Other Term Commitment
CITIBANK, N.A.		142,738,074.11
0934600 BC UNLIMITED LIABILITY COMPANY		3,870,097.15
ABERDEEN LOAN FUNDING LTD		1,536,428.57
ABS LOANS 2007 LTD		4,255,351.34
ADVANCED SERIES TRUST AST FIRST TRUST BALANCED TARGET PORTFOLIO		770,139.61
ADVANCED SERIES TRUST AST FIRST TRUST CAPITAL APPRECIATION TARGET PORTFOLIO		770,139.61
ALLIANCEBERNSTEIN INSTITUTIONAL INVESTMENTS - AXA HIGH YIELD LOAN PORTFOLIO		1,949,782.45
ALLIED WORLD ASSURANCE COMPANY LTD		1,149,892.89
ALM LOAN FUNDING 2010 3 LTD APOLLO OPPORTUNITY CREDIT FUND II		2,227,821.43
ALM V LTD		3,649,017.86
ALM VII LTD		1,551,948.04
AMERICAN STATES INSURANCE COMPANY		733,118.20
ARROWOOD INDEMNITY COMPANY BY BABSON CAPITAL MANAGEMENT LLC		1,843,714.29
ARROWOOD INDEMNITY COMPANY BY INVESCO SENIOR SECURED MGMT INC		770,139.61
ARROWOOD INDEMNITY COMPANY AS ADMINISTRATOR OF THE PENSION PLAN OF ARROWOOD INDEMNITY CO BY BABSON		460,928.57
ARROWOOD INDEMNITY COMPANY AS ADMINISTRATOR OF THE PENSION PLAN OF ARROWOOD INDEMNITY CO BY INVESCO		192,534.89
BABSON CLO LTD 2005-1		3,072,857.14
BABSON CLO LTD 2005-II		2,304,642.86
BABSON CLO LTD 2006 II		1,536,428.57
BABSON CLO LTD 2007 I		3,072,857.14
BABSON CLO LTD 2011-1		3,084,428.58
BABSON CLO LTD 2012 II		1,551,947.96
BABSON MID MARKET CLO LTD 2007 II		1,536,428.57
BAKER STREET CLO II LTD		1,153,284.12
BAKER STREET FUNDING CLO 2005 1 LTD		1,153,284.12
BANCO GENERAL OVERSEAS INC		384,107.14
BANK OF AMERICA TRADE		3,536,706.76
BARCLAYS BANK UK RETIREMENT FUND THE		845,035.71
BELHURST CLO LTD		1,315,972.72
BLACKROCK DEBT STRATEGIES FUND INC		1,382,785.71
BLACKROCK DEFINED OPPORTUNITY CREDIT TRUST		768,214.29
BLACKROCK FLOATING RATE INCOME STRATEGIES FUND INC		3,072,857.14

1

BLACKROCK FLOATING RATE INCOME TRUST	2,079,998.38
BLACKROCK FUNDS II BLACKROCK FLOATING RATE INCOME PORTFOLIO	3,263,948.03
BLACKROCK FUNDS II BLACKROCK MULTI ASSET INCOME PORTFOLIO	388,969.26
BLACKROCK GLOBAL INVESTMENT SERIES INCOME STRATEGIES PORTFOLIO	1,111,051.15
BLACKROCK LIMITED DURATION INCOME TRUST	1,152,321.43
BLACKROCK SECURED CREDIT PORTFOLIO OF BLACKROCK FUNDS II	175,036.17
BLACKROCK SENIOR FLOATING RATE PORTFOLIO BY BLACKROCK FINANCIAL	295,094.93
BLACKROCK SENIOR HIGH INCOME FUND INC	729,803.57
BLACKROCK SENIOR INCOME SERIES IV	2,112,589.29
BLACKROCK SENIOR INCOME SERIES V LIMITED	2,112,589.29
BLACKSTONE GSO MARKET NEUTRAL CREDIT MASTER FUND LP	1,540,279.28
BLACKSTONE GSO SECURED TRUST LTD	8,080,728.82
BLUE CROSS OF IDAHO HEALTH SERVICE INC	92,793.93
BLUEMOUNTAIN CLO 2011 1 LTD	1,540,279.28
BLUEMOUNTAIN CLO 2012-1 LTD	1,551,948.04
BLUEMOUNTAIN CLO 2012-2 LTD	1,559,825.96
BLUEMOUNTAIN CLO II LTD	768,214.29
BLUEMOUNTAIN CLO III LTD	768,214.29
BMI CLO I	2,304,642.86
BRIDGEPORT CLO II LTD	1,958,946.43
BRIDGEPORT CLO LTD	1,939,741.07
BURR RIDGE CLO PLUS LTD	1,171,526.79
CALLIDUS DEBT PARTNERS CLO FUND IV LTD	1,920,535.71
CALLIDUS DEBT PARTNERS CLO FUND V LTD	1,536,428.57
CALLIDUS DEBT PARTNERS CLO FUND VI LTD	1,536,428.57
CALLIDUS DEBT PARTNERS CLO FUND VII LTD	1,536,428.57
CANNINGTON FUNDING LTD	2,316,223.97
CARLYLE ARNAGE CLO LTD	1,415,730.65
CARLYLE DAYTONA CLO LTD	610,262.55
CARLYLE GLOBAL MARKET STRATEGIES CLO 2011 1 LTD	1,421,196.43
CARLYLE GLOBAL MARKET STRATEGIES CLO 2012-1 LTD	2,327,922.07
CARLYLE GLOBAL MARKET STRATEGIES CLO 2012-3 LTD	3,899,564.90
CARLYLE HIGH YIELD PARTNERS IX LTD	991,871.61
CARLYLE MCLAREN CLO LTD	613,801.59
CASTLE GARDEN FUNDING	2,304,642.86
CASTLE HILL FIXED INCOME OPPORTUNITIES SARL BY IGNIS INVESTMENT SERICES LIMITED	1,505,593.98
CENT CDO 12 LIMITED	1,139,745.34
CENT CDO 14 LIMITED	931,118.61
CENT CDO 15 LIMITED	1,120,539.98
CENT CDO XI LIMITED	2,304,642.86

2

CENT CLO 16 LP	2,333,815.55
CENTRAL PARK CLO LTD	2,310,418.89
CENTURION CDO 9 LIMITED	2,631,133.93
CHELSEA PARK CLO LTD	768,214.29
CIFC FUNDING 2006 IB LTD	652,982.14
CIFC FUNDING 2006 II LTD	1,037,089.29
CIFC FUNDING 2006-I LTD	902,651.79
CIFC FUNDING 2007 II LTD	1,770,753.24
CIFC FUNDING 2007 III LTD	1,521,083.60
CIFC FUNDING 2007-1 LTD	672,187.50
CIFC FUNDING 2011 I LTD	1,376,443.57
CIFC FUNDING 2012 I LTD	2,216,336.80
CM LIFE INSURANCE COMPANY	1,113,541.33
CN CANADIAN MASTER TRUST FUND	768,214.29
COA CAERUS CLO LTD	892,665
COLUMBIA FUND VARIABLE SERIES TRUST II VARIABLE PORTFOLIO EATON VANCE FLOATING RATE INCOME FUND	1,536,428.57
COLUMBUS PARK CDO LTD	760,454.54
COLUMBUSNOVA CLO IV LTD 2007-II	1,098,063.88
COLUMBUSNOVA CLO LTD 2006 I	652,982.14
COLUMBUSNOVA CLO LTD 2007 I	1,174,885.31
COMSTOCK FUNDING LTD	1,544,149.31
CREDIT SUISSE LOAN FUNDING LLC	544,008.92
CREDIT VALUE PARTNERS DISTRESSED DURATION MASTER FUND LP	1,555,877.04
DEL MAR CLO I LTD	2,693,563.39
DEUTSCHE BANK AG NEW YORK	83,174.92
DIVERSIFIED CREDIT PORTFOLIO LTD	3,780,315.78
DRYDEN XI LEVERAGED LOAN CDO 2006	3,508,886.31
DRYDEN XVI LEVERAGED LOAN CDO 2006	691,392.86
DRYDEN XXI LEVERAGED LOAN CDO LLC	1,544,149.30
DRYDEN XXIII SENIOR LOAN FUND	1,555,877.04
DRYDEN XXIV SENIOR LOAN FUND	584,934.74
DRYDEN XXV SENIOR LOAN FUND	2,078,019.64
EASTLAND CLO LTD	3,072,857.14
EATON VANCE CDO IX LTD	1,190,732.14
EATON VANCE CDO VIII LTD	1,709,276.79
EATON VANCE FLOATING RATE INCOME TRUST	2,247,026.79
EATON VANCE INSTITUTIONAL SENIOR LOAN FUND	9,410,625
EATON VANCE LIMITED DURATION INCOME FUND	2,131,794.64
EATON VANCE SENIOR FLOATING-RATE TRUST	1,997,357.14
EATON VANCE SENIOR INCOME TRUST	998,678.57
EATON VANCE SHORT DURATION DIVERSIFIED INCOME FUND	384,107.14
EATON VANCE VT FLOATING-RATE INCOME FUND	979,473.21
ECP CLO 2008 1 LTD	2,304,642.86
ECP CLO 2012 3 LTD	3,088,376.61
ECP CLO 2012 4 LTD	2,327,922.07

3

FACTORY MUTUAL INSURANCE COMPANY	349,188.32
FAIRWAY LOAN FUNDING COMPANY	1,152,321.43
FIDELITY ADVISOR SERIES I FIDELITY ADVISOR FLOATING RATE HIGH INCOME FUND	61,308,116.68
FINN SQUARE CLO LTD	5,766,420.34
FIRST TRUST SENIOR FLOATING RATE INCOME FUND II	3,078,535.85
FIRST WESTERN CAPITAL MANAGEMENT HIGH INCOME SENIOR LOANS LIMITED PARTNERSHIP	387,987
FIXED INCOME SHARES SERIES R	384,107.14
FLAGSHIP CLO V	768,214.29
FLATIRON CLO 2007 1 LTD BY NEW YORK LIFE	1,658,440.31
FLATIRON CLO 2011 1 LTD	2,310,418.89
FOOTHILL CLO I LTD	2,304,642.86
FORE CLO LTD 2007 1	5,383,276.03
FOUNTAIN COURT MASTER FUND	770,139.61
FOUR CORNERS CLO II LTD	1,114,682.80
FOUR CORNERS CLO III LTD	1,693,738.80
FRANKLIN CLO V LTD	4,006,285.72
FRASER SULLIVAN CLO I LTD	1,822,972.50
FRASER SULLIVAN CLO II LTD	1,822,972.50
FRASER SULLIVAN CLO V LTD	1,488,031.07
FRASER SULLIVAN CLO VI LTD	1,488,031.06
GALE FORCE 3 CLO LTD	1,536,428.57
GALE FORCE 4 CLO LTD	1,536,428.57
GANNETT PEAK CLO I LTD	2,643,905
GOLDMAN SACHS ASSET MANAGEMENT CLO PLC	3,276,491.83
GOLDMAN SACHS TRUST GOLDMAN SACHS HIGH YIELD FLOATING RATE FUND	6,159,293.89
GRAMERCY PARK CLO LTD	2,889,692.58
GRAYSON AND CO	21,515,563.11
GRAYSON CLO LTD	3,072,857.14
GREENS CREEK FUNDING LTD	2,322,058.28
GSO PALMETTO LIQUIDITY FUND LLC	1,544,149.30
GULF STREAM COMPASS CLO 2005-II LTD	1,152,321.43
GULF STREAM COMPASS CLO 2007 LTD	768,214.29
GULF STREAM SEXTANT CLO 2006 1 LTD	960,267.86
GULF STREAM SEXTANT CLO 2007 1 LTD	1,152,321.43
HARCH CLO III LIMITED	775,974.79
HARTFORD FLOATING RATE FUND THE	11,486,525.92
HARTFORD LIFE INSURANCE COMPANY BY HARTFORD INVESTMENTS	85,142.13
HARTFORD SHORT DURATION FUND	1,140,681.82
HBOS FINAL SALARY PENSION SCHEME BY PACIFIC INVESTMENT MANAGEMENT CO	1,155,209.44
HEWETTS ISLAND CLO VI LTD	1,386,646.10
HIGHLAND IBOXX SENIOR LOAN ETF	194,978.24

4

HOUSTON CASUALTY COMPANY BY BLACKROCK FINANCIAL MANAGEMENT	581,980.52
HSBC BANK PLC	1,636,628.17
IG FI CANADIAN ALLOCATION FUND	38,410.71
IHC HEALTH SERVICES INC BY PIMCO	384,107.14
ILLINOIS STATE BOARD OF INVESTMENT BY THL CREDIT SENIOR LOAN STRATEGIE	770,139.61
ING INVESTMENT MANAGEMENT CLO II LTD	1,117,771.10
ING INVESTMENT MANAGEMENT CLO III LTD	1,037,089.29
ING L FLEX SENIOR LOANS	5,527,233.96
INVESCO FLOATING RATE FUND	1,009,289.66
INVESCO SENIOR INCOME TRUST	799,767.95
INVESCO SENIOR LOAN FUND	1,123,949.05
INWOOD PARK CDO LTD	2,304,642.86
IRONSHORE INC	960,749.18
JERSEY STREET CLO LTD	1,578,062.91
JNL PPM AMERICA FLOATING RATE INCOME FUND	1,532,568.19
JPMBI RE BLACKROCK BANKLOAN FUND	770,154.24
KATONAH 2007 I CLO LTD	1,536,428.57
KATONAH IX CLO LTD	2,304,642.86
KATONAH X CLO LTD	2,304,642.86
LAFAYETTE SQUARE CDO LTD	768,214.29
LAMP FUNDS (IRE) 1 PLC SUB-FUND BLACKSTONE GSO SENIOR FLOATING RATE CORPORATE LOAN FUND	770,139.61
LANDMARK IX CDO LTD	1,536,428.57
LANDMARK VIII CLO LTD	1,536,428.57
LATITUDE CLO I LTD	384,107.14
LATITUDE CLO II LTD	384,107.14
LCM IX LIMITED PARTNERSHIP	2,409,858.77
LCM VIII LIMITED PARTNERSHIP	775,974.03
LCM X LIMITED PARTNERSHIP	1,548,038.87
LCM XI LIMITED PARTNERSHIP	2,698,711.61
LCM XII LIMITED PARTNERSHIP	2,113,692.52
LIBERTY MUTUAL INSURANCE COMPANY	4,609,285.71
LIMEROCK CLO I	1,311,975.75
LLOYDS TSB GROUP PENSION SCHEME NO 1	1,152,321.43
LLOYDS TSB GROUP PENSION SCHEME NO 2	768,214.29
LYONDELL MASTER TRUST	116,691.15
MACQUARIE FIRST TRUST GLOBAL INFRASTRUCTURE UTILITIES DIVIDEND & INCOME FUND	1,919,062.59
MAGNETITE VI LIMITED	967,561.04
MAGNETITE VII LTD	1,559,825.96
MAINSTAY FLOATING RATE FUND A SERIES OF MAINSTAY FUNDS TRUST	6,555,395.28
MAINSTAY VP FLOATING RATE PORTFOLIO A SERIES OF MAINSTAY VP FUNDS TRUST	4,651,064.53
MAPS CLO FUND II LTD	1,536,428.57
MARINE PARK CLO LTD	5,445,569.62
MARLBOROUGH STREET CLO LTD	2,006,443.83

5

MARQUETTE PARK CLO LTD	1,171,526.79
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY	5,072,799.47
MAYPORT CLO LTD	576,160.71
MET INVESTORS SERIES TRUST MET EATON VANCE FLOATING RATE PORTFOLIO	1,882,125
MET INVESTORS SERIES TRUST - PIONEER STRATEGIC INCOME PORTFOLIO	1,110,069.64
METROPOLITAN LIFE INSURANCE COMPANY BY MET LIFE	11,523,214.29
MONTPELIER INVESTMENTS HOLDINGS LTD	194,484.63
MOUNTAIN CAPITAL CLO V LTD	883,446.43
MOUNTAIN CAPITAL CLO VI LTD	885,660.56
MOUNTAIN VIEW CLO II LTD	1,536,428.57
MOUNTAIN VIEW CLO III LTD	2,306,568.18
MOUNTAIN VIEW FUNDING CLO 2006 I LTD	1,536,428.57
MSIM PECONIC BAY LTD BY INVESCO SENIOR SECURED MGMT INC	1,027,669.85
MT WHITNEY SECURITIES INC BY DEUTSCHE BANK	1,920,535.71
NEPTUNE FINANCE CCS LTD	768,214.29
NEW YORK LIFE INSURANCE AND ANNUITY CORP	6,790,762.38
NEW YORK LIFE INSURANCE COMPANY	3,603,373.90
NORTHROP GRUMMAN PENSION MASTER TRUST BY GOLDMAN SACHS ASSET MANAGEMENT	968,012.95
NUVEEN CREDIT STRATEGIES INCOME FUND	1,175,367.86
NYLIM FLATIRON CLO 2006 1 LTD	2,942,875.29
OCTAGON INVESTMENT PARTNERS V LTD	768,214.29
PACIFIC LIFE FUNDS PL FLOATING RATE LOAN FUND	230,464.29
PACIFIC SELECT FUND FLOATING RATE LOAN PORTFOLIO BY EATON VANCE	2,554,312.50
PERMANENS CAPITAL LP	602,902.34
PHOENIX CLO II LTD	691,392.86
PHOENIX CLO III LTD	691,392.86
PIMCO CAYMAN BANK LOAN FUND	1,528,668.82
PIMCO CAYMAN GLOBAL CREDIT ALPHA FUND	2,381,464.29
PIMCO COMMODITY REAL RETURN STRATEGY FUND	614,571.43
PIMCO DIVERSIFIED INCOME FUND	2,304,642.86
PIMCO FLOATING INCOME FUND	2,304,642.86
PIMCO FUNDS GLOBAL INVESTORS SERIES PLC DIVERSIFIED INCOME DURATION HEDGED FUND	385,069.83
PIMCO FUNDS GLOBAL INVESTORS SERIES PLC DIVERSIFIED INCOME FUND	4,993,392.86
PIMCO FUNDS GLOBAL INVESTORS SERIES PLC GLOBAL REAL RETURN FUND	1,305,964.29
PIMCO FUNDS GLOBAL INVESTORS SERIES PLC UNCONSTRAINED BOND FUND	15,465,223.24
PIMCO FUNDS PIMCO INCOME FUND	2,304,642.86
PIMCO FUNDS PRIVATE ACCOUNT PORTFOLIO SERIES PIMCO SENIOR FLOATING RATE PORTFOLIO	61,553.43
PIMCO INVESTMENT GRADE CORPORATE BOND FUND	8,296,714.29
PIMCO REAL RETURN ASSET FUND BY PIMCO	1,152,321.43

6

PIMCO REAL RETURN FUND	7,682,142.86
PIMCO SENIOR FLOATING RATE FUND	4,626,730.54
PIMCO UNCONSTRAINED BOND FUND	15,488,269.67
PIONEER FLOATING RATE FUND	1,294,441.07
PIONEER FLOATING RATE TRUST	1,256,030.36
PIONEER MULTI ASSET ULTRASHORT INCOME FUND	271,306.06
PIONEER SHORT TERM INCOME FUND	334,173.21
PIONEER STRATEGIC INCOME FUND	5,776,971.43
PORTOLA CLO LTD	768,214.29
PPM GRAYHAWK CLO LTD	1,538,353.90
PRIMUS CLO II LTD	1,386,646.10
PROSPECT PARK CDO LTD	1,536,428.57
PUBLIC EMPLOYEES RETIREMENT ASSOCIATION OF NEW MEXICO BY PIMCO	220,740.05
RACE POINT VI CLO LIMITED	3,103,896.10
RACE POINT VII CLO LIMITED	1,559,825.96
RED RIVER CLO LTD	2,304,642.86
REGENTS OF THE UNIVERSITY OF CALIFORNIA	272,278.23
RIDGEWORTH FUNDS SEIX FLOATING RATE HIGH INCOME FUND	20,575,586.26
RIDGEWORTH FUNDS TOTAL RETURN BOND FUND	701,882.29
RIVERSOURCE LIFE INSURANCE COMPANY	979,473.24
SAPPHIRE VALLEY CDO I LTD	768,214.29
SARATOGA CLO I LIMITED	785,370.88
SCHILLER PARK CLO LTD	1,651,660.71
SCOR GLOBAL LIFE AMERICAS REINSUREANCE COMPANY	465,584.42
SCOR REINSURANCE COMPANY	310,389.61
SENIOR DEBT PORTFOLIO BY BOSTON MANAGEMENT & RESEARCH	4,972,262.20
SILVERADO CLO 2006 II LIMITED	1,540,279.28
SOCIETE GENERALE GRAND CAYMAN BRANCH	2,368,505.91
SOUTH CAROLINA RETIREMENT SYSTEM BY PIMCO	1,536,428.57
SPECIALIZED INVESTMENT MANAGEMENT SICAV SIF CORPORATE LOAN MASTER FUND	1,155,180.05
SSD LOAN FUNDING LLC	5,740,925.73
SSOMF LOAN FUNDING LLC CITIBANK NA	5,766,420.34
STRATFORD CLO LTD	3,072,857.14
SUN LIFE ASSURANCE COMPANY OF CANADA US	1,536,428.57
SYMPHONY CLO IX LIMITED PARTNERSHIP	4,655,844.14
SYMPHONY CLO VIII LIMITED PARTNERSHIP	774,019.44
TETON FUNDING LLC SUNTRUST BANK	1,459,607.14
THE LINDE PENSION PLAN TRUST	384,107.14
TORUS INSURANCE HOLDINGS LIMITED	1,546,099.01
TRS HY FNDS LLC	1,548,038.87
UBS AG STAMFORD BRANCH	1,309,624.41
US SPECIALTY INSURANCE COMPANY BY BLACKROCK FINANCIAL MANAGEMENT	581,980.52
VENTURE V CDO LIMITED	1,152,321.43
VENTURE VI CDO LIMITED	380,246.76

7

VENTURE VII CDO LIMITED		947,613.97
VIRGINIA RETIREMENT SYSTEM BY PIMCO		576,160.71
VIRTUS SENIOR FLOATING RATE FUND		1,536,428.57
WASATCH CLO LTD		1,727,625.55
WELLS FARGO BANK NATIONAL ASSOCIATION		1,883,379.62
WESTCHESTER CLO LTD		1,536,428.57
WHITEHORSE IV LTD		1,536,428.57
Aggregate 2013 Other Term Commitments:	$	806,625,000.00

8

Schedule 2

“Base Rate Margin” with respect to the 2013 Other Term Loans shall mean, 1.75%.

“Eurodollar Margin” with respect to the 2013 Other Term Loans shall mean, 2.75%.

“Eurodollar Rate” floor with respect to the 2013 Other Term Loans shall be, 1.00%.

Exhibit A

Amendments

[see attached]

Composite copy reflecting amendments made pursuant to the Amendment dated as of February 27, 2013.

CREDIT AGREEMENT

dated as of

May 27, 2011

among

THE AES CORPORATION,

as Borrower,

BANK OF AMERICA, N.A.,

as Agent,

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

J.P. MORGAN SECURITIES LLC

MORGAN STANLEY SENIOR FUNDING, INC.,

as Joint Lead Arrangers and Joint Book Runners,

J.P. MORGAN SECURITIES LLC

MORGAN STANLEY SENIOR FUNDING, INC.,

as Co-Syndication Agents,

BARCLAYS CAPITAL

BNP PARIBAS

CREDIT AGRICOLE CIB

SCOTIA CAPITAL

UNION BANK, N.A.,

as Co-Managers,

and

THE BANKS LISTED HEREIN

TABLE OF CONTENTS

		Page
ARTICLE I
DEFINITIONS
Section 1.01	Definitions		1
Section 1.02	Accounting Terms and Determinations		29
Section 1.03	Types of Borrowing		29
ARTICLE II
THE CREDITS
Section 2.01	Commitment to Lend		29
Section 2.02	Notice of Borrowing		30
Section 2.03	Intentionally Omitted		30
Section 2.04	Evidence of Debt		30
Section 2.05	Maturity of Loans		32
Section 2.06	Interest Rates		32
Section 2.07	Method of Electing Interest Rates		32
Section 2.08	Intentionally Omitted		33
Section 2.09	Intentionally Omitted		33
Section 2.10	Prepayment of the Loans		33
Section 2.11	General Provisions as to Payments		35
Section 2.12	Funding Losses		36
Section 2.13	Computation of Interest and Fees		37
Section 2.14	Intentionally Omitted		37
Section 2.15	Intentionally Omitted		37
Section 2.16	Refinancing Amendments		37
Section 2.17	Increase in Term Loan Commitments		37

i

ARTICLE III
CONDITIONS
Section 3.01	Closing	40
Section 3.02	Extension of Credit	42
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01	Corporate Existence and Power	42
Section 4.02	Corporate and Governmental Authorization and Filings; No Contravention	42
Section 4.03	Compliance with Laws	43
Section 4.04	Binding Effect	43
Section 4.05	Financial Information	44
Section 4.06	Litigation	44
Section 4.07	Compliance with ERISA	44
Section 4.08	Environmental Matters	44
Section 4.09	Taxes	45
Section 4.10	Material Subsidiaries	45
Section 4.11	Not an Investment Company	46
Section 4.12	Intentionally Omitted	46
Section 4.13	Full Disclosure	46
Section 4.14	Collateral Documents and Collateral	46
Section 4.15	Intentionally Omitted	47
Section 4.16	Solvency	47
Section 4.17	Pledged Subsidiaries	48
Section 4.18	Qualified Holding Companies Debt	48

ii

ARTICLE V
COVENANTS
Section 5.01	Information	48
Section 5.02	Payment of Obligations	52
Section 5.03	Maintenance of Property; Insurance	52
Section 5.04	Conduct of Business and Maintenance of Existence	52
Section 5.05	Compliance with Laws	52
Section 5.06	Inspection of Property, Books and Records	53
Section 5.07	Intentionally Omitted	55
Section 5.08	Use of Proceeds	55
Section 5.09	Intentionally Omitted	55
Section 5.10	Negative Pledge	55
Section 5.11	Consolidations and Mergers	55
Section 5.12	Intentionally Omitted	55
Section 5.13	Intentionally Omitted	55
Section 5.14	Intentionally Omitted	55
Section 5.15	Intentionally Omitted	55
Section 5.16	As to Existing Credit Agreement	55
Section 5.17	Upstreaming of Net Cash Proceeds by Subsidiaries	55
Section 5.18	Restrictions on Sales and Leasebacks	56
Section 5.19	Intentionally Omitted	56
Section 5.20	Covenant to Give Security	56
Section 5.21	Further Assurances	57

iii

ARTICLE VI
DEFAULTS
Section 6.01	Events of Default	58
Section 6.02	Notice of Default	61
ARTICLE VII
THE AGENT
Section 7.01	Appointment and Authorization	61
Section 7.02	Rights as a Bank	61
Section 7.03	Exculpatory Provisions	61
Section 7.04	Reliance by Agent	60
Section 7.05	Delegation of Duties	61
Section 7.06	Resignation of Agent	61
Section 7.07	Non-Reliance on Agent and Other Banks	62
Section 7.08	No Other Duties, Etc	62
Section 7.09	Agent May File Proofs of Claim	62
Section 7.10	Collateral Matters	63
Section 7.11	Notices; Effectiveness; Electronic Communication	63
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
Section 8.01	Basis for Determining Interest Rate Inadequate or Unfair	65
Section 8.02	Illegality	66
Section 8.03	Increased Cost and Reduced Return	66
Section 8.04	Taxes	68
Section 8.05	Base Rate Loans Substituted for Affected Eurodollar Loans	71

iv

ARTICLE IX
INTENTIONALLY OMITTED.
ARTICLE X
MISCELLANEOUS
Section 10.01	Intentionally Omitted	71
Section 10.02	No Waivers	71
Section 10.03	Expenses; Indemnification; Waiver and Acknowledgment	72
Section 10.04	Sharing of Payments	73
Section 10.05	Amendments and Waivers	74
Section 10.06	Successors and Assigns	74
Section 10.07	No Margin Stock	78
Section 10.08	Governing Law; Submission to Jurisdiction	78
Section 10.09	Release of Collateral	78
Section 10.10	Counterparts; Integration; Effectiveness	78
Section 10.11	Confidentiality	79
Section 10.12	WAIVER OF JURY TRIAL	79
Section 10.13	Severability; Modification to Conform to Law	80
Section 10.14	Judgment Currency	80
Section 10.15	Intentionally Omitted	80
Section 10.16	Replacement of Banks	80
Section 10.17	Permitted Amendments	81
Section 10.18	USA PATRIOT Act	82
Section 10.19	No Advisory or Fiduciary Responsibility	82
Section 10.20	Electronic Execution of Assignments and Certain Other Documents	83

v

CREDIT AGREEMENT

CREDIT AGREEMENT dated as of May 27, 2011 (this “Agreement”) among THE AES CORPORATION, a Delaware corporation (the “Borrower”), MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, J.P. MORGAN SECURITIES LLC and MORGAN STANLEY SENIOR FUNDING, INC., as Joint Lead Arrangers (the “Joint Lead Arrangers”) and Joint Book Runners (the “Joint Book Runners”), J.P. MORGAN SECURITIES LLC and MORGAN STANLEY SENIOR FUNDING, INC. as Co-Syndication Agents (the “Co-Syndication Agents”), BANK OF AMERICA, N.A., as Agent for the Bank Parties (the “Agent”) and each lender from time to time party hereto (collectively, the “Banks” and individually, a “Bank”).

PRELIMINARY STATEMENTS:

WHEREAS, the Borrower has requested that the Banks each make a single Term Loan to the Borrower on the Closing Date in accordance with the terms of this Agreement. The Banks have indicated their willingness to agree to make such Loan, but only on the terms and conditions of this Agreement, including causing the Obligations of the Borrower under the Financing Documents to be secured by the Collateral pursuant to the Collateral Documents.

WHEREAS, Borrower has requested that, simultaneously with the 2013 Transactions, the 2013 Other Term Loan Banks make 2013 Other Term Loans in an aggregate principal amount of $806,625,000.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements contained herein, the parties hereto hereby covenant and agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions.

The following terms, as used herein, have the following meanings:

“2013 Transactions” shall mean the collective reference to (a) the transactions effected by the 2013 Amendment and (b) the payment of all fees and expenses with respect to the foregoing.

“2013 Amendment” shall mean that certain Amendment No. 1 dated as of February 27, 2013 among Borrower, the 2013 Other Term Loan Banks and the Agent.

“2013 Amendment Effective Date” shall mean the “Amendment Effective Date” as such term is defined in the 2013 Amendment.

“2013 Other Term Loan” shall have the meaning provided in the 2013 Amendment.

“2013 Other Term Loan Bank” shall have the meaning provided in the 2013 Amendment.

“2013 Other Term Commitment” shall have the meaning provided in the 2013 Amendment.

“2013 Other Term Loan Termination Date” shall have the meaning provided in the 2013 Amendment.

“Acceptance Notice” has the meaning set forth in Section 2.10(b)(ii).

“Accepting Banks” shall have the meaning set forth in Section 10.17.

“Act” shall have the meaning set forth in Section 10.18.

“Additional Collateral Trust Agreement Collateral” means the “Additional Collateral” referred to in the Collateral Trust Agreement.

“Additional Term Loan Bank” means any bank, other financial institution or institutional investor that, in any case, is not an existing Bank and that agrees to provide any portion of any (a) Credit Agreement Refinancing Indebtedness pursuant to a Refinancing Amendment in accordance with Section 2.16 (including the 2013 Other Term Loan Banks under the 2013 Amendment) or (b) Commitment Increase pursuant to Section 2.17; provided that each Additional Term Loan Bank (other than any Person that is a Bank, an Affiliate of a Bank or an Approved Fund of a Bank at such time) shall be subject to the approval of the Agent (such approval not to be unreasonably withheld or delayed), in each case to the extent any such consent would be required from the Agent under Section 10.06(c) for an assignment of Loans to such Additional Bank.

“Adjusted Parent Operating Cash Flow” means, for any period, (i) Parent Operating Cash Flow for such period less (ii) the sum of the following expenses (determined without duplication), in each case to the extent paid by the Borrower during such period in cash and regardless of whether any such amount was accrued during such period:

(A) income tax expenses of the Borrower and its Subsidiaries (other than income tax expenses of Subsidiaries that are not organized under the laws of the United States or any State thereof); and

(B) corporate overhead expenses (including rental expense of the Borrower).

For purposes of determining Adjusted Parent Operating Cash Flow for any period, the contribution to Parent Operating Cash Flow for such period from any Subsidiary not organized under the law of the United States or any State thereof shall be reduced (but

2

Eurodollar Rate plus 1.00% and (d) 2.00%. The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such prime rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.

“Base Rate Borrowing” has the meaning set forth in the definition of “Borrowing” herein.

“Base Rate Loan” means a Loan which bears interest at the Base Rate pursuant to the applicable Notice of Borrowing or Notice of Interest Rate Election or the provisions of Section 2.07(a) or Article VIII plus the Base Rate Margin.

“Base Rate Margin” means (i) in respect of the Initial Term Loans, a rate per annum equal to 2.25%, (ii) in respect of the 2013 Other Term Loans, a rate per annum equal to 1.75%, (iii) in respect of the Other Term Loans, a rate per annum to be agreed in the applicable Refinancing Amendment and (iv) in respect of the Incremental Term Loan Facility, a rate per annum to be agreed to by the Borrower, the Agent and the Incremental Term Loan Banks.

“Benefit Arrangement” means, at any time, an employee benefit plan within the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and which is maintained or otherwise contributed to by any member of the ERISA Group.

“Borrower” has the meaning set forth in the recital of the parties to this Agreement.

“Borrower Materials” has the meaning set forth in Section 7.11(c).

“Borrowing” means (i) a borrowing hereunder consisting of Initial Term Loans made to the Borrower at the same time by the Initial Term Loan Banks pursuant to Section 2.01, (ii) a borrowing hereunder consisting of Other Term Loans made to the Borrower at the same time by the Other Term Loan Banks pursuant to Section 2.16, or (iii) a borrowing hereunder consisting of Incremental Term Loans made to the Borrower at the same time by the Incremental Term Loan Banks pursuant to Section 2.17. A Borrowing is a “Base Rate Borrowing” if such Loans are Base Rate Loans or a “Eurodollar Borrowing” if such Loans are Eurodollar Loans.

“Business Day” means either (i) a Domestic Business Day or (ii) a Eurodollar Business Day, as applicable.

“BVI Cayman Pledge Agreement” means the Pledge Agreement dated as of December 12, 2002, made by AES BVI II in favor of the Collateral Trustees.

“BVI Collateral” means the “Collateral” referred to in the BVI Cayman Pledge Agreement.

5

“Collateral Account” has the meaning as set forth in the Collateral Trust Agreement.

“Collateral Documents” means the Security Agreement, the Collateral Trust Agreement, the BVI Cayman Pledge Agreement and any other agreement that creates or purports to create a Lien in favor of the Collateral Trustees for the benefit of the Secured Holders.

“Collateral Trust Agreement” means the Collateral Trust Agreement dated as of December 12, 2002 made by the grantors thereunder in favor of the Collateral Trustees, as amended by Amendment No. 1 dated as of July 29, 2003, Amendment No. 2 dated as of March 17, 2004, Amendment No. 3 dated as of August 20, 2009 and as further amended from time to time.

“Collateral Trustees” has the meaning as set forth in the Collateral Trust Agreement.

“Commitment Increase” has the meaning set forth in Section 2.17(a).

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

“Conduit Bank” means any special purpose corporation organized and administered by any Bank for the purpose of making Loans hereunder otherwise required to be made by such Bank and designated by such Bank in a written instrument, subject to the consent of the Agent and the Borrower (which, in each case, shall not be unreasonably withheld or delayed); provided that the designation by any Bank of a Conduit Bank shall not relieve the designating Bank of any of its obligations to fund a Loan under the Agreement if, for any reason, its Conduit Bank fails to fund any such Loan, and the designating Bank (and not the Conduit Bank) shall have the sole right and responsibility to deliver all consents and waivers required or requested under this Agreement with respect to its Conduit Bank, and provided further that no Conduit Bank shall be entitled to receive any greater amount pursuant to Section 8.03, 8.04 or 10.03 than the designating Bank would have been entitled to receive in respect of the extensions of credit made by such Conduit Bank.

“Consolidated Net Assets” means the aggregate amount of assets (less reserves and other deductible items) after deducting current liabilities, as shows on the consolidated balance sheet of the Borrower and its Subsidiaries contain in the latest annual report to the stockholders of the Borrower and prepared in accordance with GAAP.

“Consolidated Subsidiary” means, at any date with respect to any Person, any Subsidiary of such Person or other entity the accounts of which would be consolidated with those of such Person in its consolidated financial statements if such statements were prepared as of such date.

“Controlling Person” has the meaning set forth in the definition of “Affiliate” herein.

7

“Eurodollar Business Day” means any Domestic Business Day on which commercial banks are open for international business (including dealings in dollar deposits) in London.

“Eurodollar Default Rate” has the meaning set forth in Section 2.06(c).

“Eurodollar Lending Office” means, as to each Bank Party, its office, branch or affiliate located at its address set forth in its Administrative Questionnaire (or identified in its Administrative Questionnaire as its Eurodollar Lending Office) or such other office, branch or affiliate of such Bank Party as it may hereafter designate as its Eurodollar Lending Office by notice to the Borrower and the Agent.

“Eurodollar Loan” means a Loan which bears interest at the Eurodollar Rate pursuant to the applicable Notice of Borrowing or Notice of Interest Rate Election plus the Eurodollar Margin.

“Eurodollar Margin” means (i) in respect of the Initial Term Loans, a rate per annum equal to 3.25%, (ii) in respect of the 2013 Other Term Loans, a rate per annum equal to 2.75%, (iii) in respect of the Other Term Loans, a rate per annum to be agreed in the applicable Refinancing Amendment and (iv) in respect of the Incremental Term Loan Facility, a rate per annum to be agreed to by the Borrower, the Agent and the Incremental Term Loan Banks.

“Eurodollar Rate” means:

(a) for any Interest Period with respect to a Eurodollar Loan, the rate per annum equal to (i) the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or such other commercially available source providing quotations of BBA LIBOR as may be designated by the Agent from time to time) at approximately 11:00 a.m., London time, two Eurodollar Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or, (ii) if such rate is not available at such time for any reason, the rate per annum determined by the Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Loan being made, continued or converted and with a term equivalent to such Interest Period would be offered by Bank of America’s London branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two Eurodollar Business Days prior to the commencement of such Interest Period and (b) for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to (i) BBA LIBOR, at approximately 11:00 a.m., London time determined two Eurodollar Business Days prior to such date for Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not available at such time for any reason, the rate per annum determined by the Agent to be the rate at which deposits in Dollars for delivery on the date of determination in same day funds in the approximate amount of the Base Rate Loan being made or maintained and with a term equal to one month would be offered by Bank of America’s London Branch to major banks in the London interbank Eurodollar market at their request at the date and time of determination. Notwithstanding anything to the contrary contained herein, the Eurodollar Rate shall at all times at least equal or exceed 1.00%.

12

“Event of Default” has the meaning set forth in Section 6.01.

“Excluded AES Business” means any AES Business located in Brazil or Argentina; provided that the Borrower may by written notice to the Agent make an election not to treat one or more AES Businesses in Brazil or Argentina as an “Excluded AES Business”. Once the Borrower elects not to treat an AES Business as an “Excluded AES Business” it may not thereafter change or revoke such election with respect to such AES Business without the consent of the Required Banks.

“Excluded Swap Obligation” means, with respect to the Borrower or any of its Subsidiaries, any obligation (a “Swap Obligation”) to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act, if, and to the extent that, all or a portion of the Guarantee of the Borrower or any such Subsidiary , of, or the grant by the Borrower or any such Subsidiary, of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof).

“Existing Credit Agreement” means the Fifth Amended and Restated Credit Agreement dated as of July 29, 2010, among the Borrower, Citicorp USA, Inc., as Agent, the guarantors party thereto and the other lenders party thereto.

“Existing Trust Preferred Securities” means the $3.375 Trust Preferred Securities, Series C issued by AES Trust III on October 7, 1999.

“Extension of Credit” means a Borrowing pursuant to Section 2.01 or Section 2.17.

“Facilities” means the Initial Term Loan Facility, any Other Term Loan Facility made available to the Borrower pursuant to Section 2.16 and any Incremental Term Loan Facility made available to the Borrower pursuant to Section 2.17.

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Domestic Business Day next succeeding such day; provided that (a) if such day is not a Domestic Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Domestic Business Day as so published on the next succeeding Domestic Business Day, and (b) if no such rate is so published on such next succeeding Domestic Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Agent.

13

“Financing Documents” means this Agreement, the Collateral Documents, the Term Loan Notes and the 2013 Amendment.

“Financing Parties” means (i) the Bank Parties hereunder and (ii) the “Bank Parties” under and as defined in the Existing Credit Agreement.

“First Priority Secured Debt” means Debt of the Borrower secured by a first-priority lien on the Creditor Group Collateral (subject to the limitations set forth in Section 5.10), provided that Debt owed to an Affiliate of the Borrower shall not be First Priority Secured Debt.

“Fund” means and Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“Funded Debt” means indebtedness for borrowed money having a maturity of, or by its terms extendible or renewable for, a period of more than 12 months after the date of determination of the amount thereof.

“GAAP” has the meaning set forth in Section 1.02.

“Grantor” means each of the Borrower, AES BVI II, AES Hawaii Management Company, Inc., AES New York Funding, L.L.C., AES Oklahoma Holdings, L.L.C. and AES Warrior Run Funding, L.L.C.

“Group of Loans” means, at any time, a group of Loans consisting of (i) all Loans which are Base Rate Loans at such time or (ii) all Eurodollar Loans having the same Interest Period at such time; provided that if a Loan of any particular Bank is converted to or made as a Base Rate Loan pursuant to Article VIII, such Loan shall be included in the same Group or Groups of Loans from time to time as it would have been in if it had not been so converted or made.

“Guarantee” by any Person means any obligation, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt or other obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay or to maintain financial statement conditions or otherwise) or (ii) entered into for the purpose of assuring in any other manner the obligee of such Debt or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business or, for the avoidance of doubt,

14

“Incremental Term Loan Note” means a promissory note of the Borrower to the order of any Incremental Term Loan Bank, in substantially the form of Exhibit A hereto (with such modifications as the Borrower and the Agent may agree are necessary to evidence the terms of the Incremental Term Loan Facility), evidencing the indebtedness of the Borrower to such Bank resulting from the Incremental Term Loan deemed to have been made by such Bank.

“Incremental Term Loan Termination Date” has the meaning set forth in the definition of “Termination Date” herein.

“Indemnitee” has the meaning set forth in Section 10.03(b).

“Initial Term Loan” means each Term Loan made hereunder in accordance with the terms of Section 2.01 and each Initial Term Loan made as a result of a Commitment Increase in accordance with the terms of Section 2.17.

“Initial Term Loan Bank” means each Bank (including any Additional Term Loan Bank) having an Initial Term Loan.

“Initial Term Loan Commitment” means, with respect to each Initial Term Loan Bank, the amount set forth opposite its name on Appendix I hereto or, if such Bank has entered into one or more Assignment and Assumptions or Assumption Agreements or is an Additional Term Loan Bank, the amount set forth for such Bank in respect of the Initial Term Loan Facility in the Register maintained by the Agent pursuant to Section 10.06(g).

“Initial Term Loan Facility” means, at any time, the aggregate amount of the Initial Term Loan Banks’ Initial Term Loans at such time.

“Initial Term Loan Note” means a promissory note of the Borrower to the order of any Initial Term Loan Bank, in substantially the form of Exhibit A hereto, evidencing the indebtedness of the Borrower to such Bank resulting from the Initial Term Loan deemed to have been made by such Bank.

“Initial Term Loan Termination Date” has the meaning set forth in the definition of “Termination Date” herein.

“Interest Period” means, with respect to each Eurodollar Loan, the period commencing on the date of borrowing specified in the applicable Notice of Borrowing or on the date specified in an applicable Notice of Interest Rate Election and ending one, two, three, six or, with the consent of all affected Banks, nine or twelve months thereafter, as the Borrower may elect in such notice; provided that:

(iv) any Interest Period which would otherwise end on a day which is not a Eurodollar Business Day shall be extended to the next succeeding Eurodollar Business Day unless such Eurodollar Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Eurodollar Business Day;

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(v) any Interest Period which begins on the last Eurodollar Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall, subject to clause (iii) below, end on the last Eurodollar Business Day of a calendar month; and

(vi) (x) with respect to any Initial Term Loans, any Interest Period that would otherwise end after the Initial Term Loan Termination Date shall end on the Initial Term Loan Termination Date, (y) with respect to any Other Term Loans, any Interest Period that would otherwise end after the applicable Other Term Loan Termination Date shall end on the applicable Other Term Loan Termination Date and (z) with respect to any Incremental Term Loans, any Interest Period that would otherwise end after the applicable Incremental Term Loan Termination Date shall end on the applicable Incremental Term Loan Termination Date.

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended, or any successor statute.

“Investment” means any investment in any Person, whether by means of share purchase, capital contribution, loan, Guarantee, time deposit or otherwise (but not including any demand deposit).

“IPALCO” means Ipalco Enterprises, Inc., an Indiana corporation.

“Joint Book Runners” has the meaning set forth in the recitals of the parties to this Agreement.

“Joint Lead Arrangers” has the meaning set forth in the recitals of the parties to this Agreement.

“Lender Parties” has the meaning set forth in the Collateral Trust Agreement.

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind, or any other type of preferential arrangement that has the practical effect of creating a security interest, in respect of such asset. For the purposes of this Agreement, the Borrower or any of its Subsidiaries shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset.

“Loan” means a Term Loan, which may be a Base Rate Loan or a Eurodollar Loan and “Loans” means Term Loans, each of which may be Base Rate Loans or Eurodollar Loans or any combination of the foregoing.

“Material Adverse Effect” means a material adverse effect on (i) the business, consolidated results of operations, consolidated financial condition or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its material obligations under any Financing Document or (iii) the rights of and remedies available to any Bank Party under any Financing Document.

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“Material Obligation” means any obligation or liability in an amount equal to or in excess of $100,000,000.

“Material Subsidiary” of any Person means, as of any date, any Subsidiary of which such Person’s proportionate share of such Subsidiary’s total assets (after intercompany eliminations) exceeds 15% of the total assets of such Person on a consolidated basis.

“Minimum CP Rating” means (i) A-1 for Standard & Poor’s Ratings Services; (ii) P-1 for Moody’s Investors Service, Inc.; (iii) F-1 for Fitch IBCA, Inc. and (iv) D-1 for Duff & Phelps Credit Rating Co.

“Multiemployer Plan” means at any time an employee pension benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an obligation to make contributions or has within the preceding five plan years made contributions, including for these purposes any Person which ceased to be a member of the ERISA Group during such five year period.

“Net Cash Proceeds” with respect to any Asset Sale, means cash payments received (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise, but only as and when received (including any cash received upon sale or disposition of such note or receivable), excluding any other consideration received in the form of assumption by the acquiring Person of Debt or other obligations relating to the property disposed of in such Asset Sale or received in any other noncash form) therefrom, in each case, net of:

(vii) all legal, title and recording tax expenses, commissions and other customary fees and expenses incurred (including, without limitation, consent and waiver fees and any applicable premiums, earn-out or working interest payments or payments in lieu or in termination thereof), and all federal, state, provincial, foreign and local taxes payable to the relevant tax authority (x) as a direct consequence of such Asset Sale, (y) as a result of the required repayment of any Debt in any jurisdiction other than the jurisdiction where the property disposed of was located or (z) as a result of any repatriation to the U.S. of any proceeds of such Asset Sale,

(viii) a reasonable reserve (which reserve if required by the applicable sale agreement, shall be deposited into a third party escrow account with an escrow agent and shall be maintained in such account until such time as the applicable indemnification obligation expires or the amounts on deposit are required to make indemnification payments) for any indemnification payments (fixed and contingent) attributable to seller’s indemnities to the purchaser undertaken by the Borrower or any of its Subsidiaries in connection with such Asset Sale (but excluding any payments, which by the terms of the indemnities will not, under any circumstances, be made prior to the Initial Term Loan Termination Date); provided that any amounts in such reserve to the extent not paid to the purchaser as an indemnification payment after the expiration of any applicable time period set forth in the agreements in respect of such Asset Sale shall be treated as “Net Cash Proceeds” for all purposes of this Agreement,

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(ix) all payments made on any Debt which must by its terms or by applicable law be repaid out of the proceeds from such Asset Sale, and

(x) all required distributions and other required payments made to minority interest holders in Subsidiaries or joint ventures as a result of such Asset Sale;

provided that for purposes of determining Net Cash Proceeds received by a Subsidiary required to be applied pursuant to Section 2.10, only that portion of such Net Cash Proceeds received by the Borrower or a Qualified Holding Company whose Equity Interests have been pledged to the Secured Holders pursuant to the Collateral Documents from such Subsidiary in accordance with Section 5.17 shall be included.

“Non-Consenting Bank” has the meaning set forth in Section 10.16.

“Non-Pledged Subsidiaries” means (i) as of the Closing Date, each of the direct Subsidiaries of the Borrower or of AES BVI II listed on Schedule III or (ii) after the Closing Date, in addition to the “Non-Pledged Subsidiaries” set forth on Schedule III, any newly formed or acquired direct (1) Subsidiary of the Borrower whose aggregate assets have a fair market value not in excess of $3,000,000 and, together with the fair market value of the assets of all Non-Pledged Subsidiaries (other than any Subsidiary which is described in clause (2) below), does not exceed $50,000,000 or (2) Subsidiaries of the Borrower for which a grant or perfection of a Lien on such Subsidiary’s stock would require approvals and consents from foreign and domestic regulators and from lenders to, and suppliers, customers or other contractual counterparties of, such Subsidiary.

“Notice of Borrowing” has the meaning set forth in Section 2.02.

“Notice of Interest Rate Election” has the meaning set forth in Section 2.07(a).

“Obligation” means, with respect to any Person, any payment, performance or other obligation of such Person of any kind, including, without limitation, any liability of such Person on any claim, whether or not the right of any creditor to payment in respect of such claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such claim is discharged, stayed or otherwise affected by any proceeding referred to in Section 6.01(d) or (e). Without limiting the generality of the foregoing, the Obligations of the Borrower under the Financing Documents include (i) the obligation to pay principal, interest, charges, expenses, fees, attorneys’ fees and disbursements, indemnities and other amounts payable by the Borrower under any Financing Document and (ii) the obligation of the Borrower to reimburse any amount in respect of any of the foregoing that any Bank Party, in its sole discretion, may elect to pay or advance on behalf of the Borrower. Nothwithstanding the foregoing, the Obligations shall in no event include any Excluded Swap Obligations.

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“Off Balance Sheet Obligation” means, with respect to any Person, any Obligation of such Person under a synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing classified as an operating lease in accordance with GAAP, if such Obligations would give rise to a claim against such Person in a proceeding referred to in Section 6.01(d).

“Other Taxes” has the meaning set forth in Section 8.04(b).

“Other Term Commitments” means one or more tranches of Loan commitments hereunder that result from a Refinancing Amendment. The aggregate amount of Other Term Commitments as of the 2013 Amendment Effective Date is $806,625,000.

“Other Term Loan Bank” means each Bank (including any Additional Term Loan Bank) having an Other Term Loan.

“Other Term Loan Facility” means, at any time, the aggregate amount of the Other Term Loan Banks’ Other Term Loans at such time.

“Other Term Loan Note” means a promissory note of the Borrower to the order of any Other Term Loan Bank, in substantially the form of Exhibit A hereto (with such modifications as the Borrower and the Agent may agree are necessary to evidence the terms of the Other Term Loan Facility), evidencing the indebtedness of the Borrower to such Bank resulting from the Other Term Loans deemed to have been made by such Bank.

“Other Term Loans” means one or more tranches of Loan that result from a Refinancing Amendment.

“Other Term Loan Termination Date” has the meaning set forth in the definition of “Termination Date”.

“Parent” means, with respect to any Bank Party, any Person controlling such Bank Party.

“Parent Operating Cash Flow” means, for any period, the sum of the following amounts (determined without duplication) as calculated below:

(xi) dividends paid to the Borrower by its Subsidiaries during such period;

(xii) consulting and management fees paid to the Borrower for such period;

(xiii) tax sharing payments made to the Borrower during such period;

(xiv) interest and other distributions paid to the Borrower during such period with respect to cash and other Temporary Cash Investments of the Borrower;

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(xv) cash payments made to the Borrower in respect of foreign exchange Hedge Agreements or other foreign exchange activities entered into by the Borrower on behalf of any of its Subsidiaries; and

(xvi) other cash payments made to the Borrower by its Subsidiaries other than (A) returns of invested capital; (B) payments of the principal of Debt of any such Subsidiary to the Borrower and (C) payments in an amount equal to the aggregate amount released from debt service reserve accounts upon the issuance of letters of credit for the account of the Borrower and the benefit of the beneficiaries of such accounts.

For purposes of determining Parent Operating Cash Flow:

(1) the aggregate net cash payments received by a Qualified Holding Company whose Equity Interests have been pledged to the Secured Holders as and to the extent required by the Collateral Documents during any period which could have been (without regard for any cash held by such Qualified Holding Company at the beginning of such period), but were not, paid as a dividend to the Borrower during such period due to tax or other cash management considerations may be included in Parent Operating Cash Flow for such period; provided that any amounts so included will not be included in Parent Operating Cash Flow if and when paid to the Borrower in any subsequent period; and

(2) Net Cash Proceeds from Asset Sales shall not be included in Parent Operating Cash Flow for any period.

“Participant” has the meaning set forth in Section 10.06(b).

“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

“Permitted Amendment” means, one or more amendments providing for an extension of the final maturity date of any Loan and/or any commitment of the Accepting Banks (provided, that such extensions may not result in having more than eight different final maturity dates under this Agreement without the prior written consent of the Agent (such consent not to be unreasonably withheld, conditioned or delayed)) and, in connection therewith and subject to the limitations set forth in Section 10.17, any change in the Base Rate Margin and/or Eurodollar Margin and other pricing with respect to the applicable Loans and/or commitments of the Accepting Banks and the payment of any fees (including prepayment premiums or fees) to the Accepting Banks (such changes and/or payments to be in the form of cash, equity interest or other property as agreed by the Borrower and the Accepting Banks to the extent not prohibited by this Agreement).

“Permitted Business” means, with respect to any Person, (i) a line of business which is substantially the same line of business as one or more of the principal businesses of such Person and its Subsidiaries, (ii) a line of business which is complementary or ancillary to, one or more of the principal businesses of such Person and its Subsidiaries, (iii) any

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“Qualified Equity-Linked or Hybrid Securities” means preferred stock, mandatorily convertible debt securities and Hybrid Securities, in each case, that does not constitute Redeemable Stock.

“Qualified Holding Company” means any Wholly-Owned Consolidated Subsidiary of the Borrower that satisfies, and all of whose direct or indirect holding companies (other than the Borrower) are Wholly-Owned Consolidated Subsidiaries of AES that satisfy, the following conditions:

(xvii) its direct and indirect interest in any AES Business shall be limited to the ownership of Capital Stock or Debt obligations of a Person with a direct or indirect interest in such AES Business;

(xviii) except as a result of the Financing Documents (and permitted refinancings thereof), no consensual encumbrance or restriction of any kind shall exist on its ability to make payments, distributions, loans, advances or transfers to the Borrower;

(xix) it shall not have outstanding any Debt other than Guarantees of Debt under, or Liens constituting Debt under, the Financing Documents (and permitted refinancings thereof) and Debt to the Borrower or to other Qualified Holding Companies (other than AES BVI II);

(xx) it shall engage in no business or other activity, shall enter into no binding agreements and shall incur no obligations (other than agreements with, and obligations to, the Borrower or other Qualified Holding Companies (other than AES BVI II)) other than (A) the holding of the Capital Stock and Debt obligations permitted under clause (i) above, including entering into retention agreements and subordination agreements relating to such Capital Stock and Debt, (B) the holding of cash received from its Subsidiaries and the investment thereof in Temporary Cash Investments, (C) the payment of dividends and other amounts to the Borrower, (D) ordinary business development activities, (E) the making (but not the entering into binding obligations to make) of Investments in AES Businesses owned by its Subsidiaries, and (F) entering into foreign exchange Hedge Agreements in respect of dividends received or expected to be received from Subsidiaries of such Qualified Holding Company, in a notional amount not to exceed $100,000,000 outstanding at any time for each Qualified Holding Company and for a term of no more than six months from the date the relevant Hedge Agreement is entered into; and

(xxi) is listed on Schedule IV hereto (as supplemented from time to time by written notice to the Agent by the Borrower).

“Quarterly Payment Date” means each March 15, June 15, September 15 and December 15.

“Recourse Debt” means, on any date, the sum of (i) Debt of the Borrower (other than (x) Equity Credit Preferred Securities, (y) Qualified Equity-Linked or Hybrid Securities and (z) undrawn letters of credit supporting business development activities) plus (ii) Derivative Obligations of the Borrower plus (iii) Off Balance Sheet Obligations of the Borrower.

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“Recourse Debt to Cash Flow Ratio” means, for any period, the ratio of:

(xxii) the sum of the Recourse Debt as of the end of such period to;

(xxiii) the Adjusted Parent Operating Cash Flow during such period.

“Redeemable Stock” means any class or series of Capital Stock or Hybrid Securities of any Person that by its terms or otherwise is (i) required to be redeemed prior to the date that is 180 days following the Initial Term Loan Termination Date (other than a redemption solely in the form of Capital Stock that does not constitute Redeemable Stock), (ii) redeemable at the option of the holder of such class or series of Capital Stock or Hybrid Securities at any time prior to the date that is 180 days following the Initial Term Loan Termination Date or (iii) convertible into or exchangeable for (unless solely at the option of such person) Capital Stock or Hybrid Securities referred to in clause (i) or (ii) above or Debt having a scheduled maturity prior to the date that is 180 days following the Initial Term Loan Termination Date; provided that any Capital Stock or Hybrid Securities that would not constitute Redeemable Stock but for provisions thereof giving holders thereof the right to require such person to repurchase or redeem such Capital Stock or Hybrid Securities upon the occurrence of an “asset sale” or a “change of control” occurring prior to the date that is 180 days following the Initial Term Loan Termination Date shall not constitute Redeemable Stock if such Capital Stock or Hybrid Securities specifically provides that such person will not repurchase or redeem any such Capital Stock or Hybrid Securities pursuant to such provisions unless such repurchase or redemption is permitted under the terms of this Agreement.

“Refinanced Term Debt” has the meaning set forth in the definition of “Credit Agreement Refinancing Indebtedness”.

“Refinancing Amendment” means an amendment to this Agreement in form and substance reasonably satisfactory to the Agent and the Borrower executed by each of (a) the Borrower, (b) the Agent and (c) each Additional Term Loan Bank and Bank, as the case may be, that agrees to provide any portion of the Credit Agreement Refinancing Indebtedness being incurred pursuant thereto, in accordance with Section 2.16.

“Register” has the meaning set forth in Section 10.06(g).

“Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.

“Related Fund” means with respect to any Bank that is an investment fund, any other investment fund that invests in commercial loans that is managed by the same investment advisor as such Bank or by an Affiliate of such Bank or such investment advisor.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees and advisors of such Person and of such Person’s Affiliates.

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Standard & Poor’s Ratings Services, Moody’s Investors Service, Inc., Fitch IBCA, Inc. and Duff & Phelps Credit Rating Co., provided that one of such two Minimum CP Ratings is by Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc.; (iii) time deposits with, including certificates of deposit issued by, any office located in the United States of any bank or trust company which is organized or licensed under the laws of the United States or any state thereof and has capital, surplus and undivided profits aggregating at least $500,000,000; (iv) medium term notes, auction rate preferred stock, asset backed securities, bonds, notes and letter of credit supported instruments, issued by any entity organized under the laws of the United States, or any state or municipality of the United States and rated in any of the three highest rated categories by Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc.; (v) repurchase agreements with respect to securities described in clause (i) above entered into with an office of a bank or trust company meeting the criteria specified in clause (iii) above; (vi) Eurodollar certificates of deposit issued by any bank or trust company which has capital and unimpaired surplus of not less than $500,000,000 or (vii) with respect to a Subsidiary, any category of investment designated as permissible investments under such Subsidiary’s loan documentation; provided that in each case (except clause (vii)) that such Investment matures within 15 months from the date of acquisition thereof by the Borrower or a Subsidiary and (B) registered investment companies that are “money market funds” within the meaning of Rule 2a-7 under the Investment Company Act of 1940.

“Term Loan” means each Initial Term Loan, each Other Term Loan and each Incremental Term Loan.

“Term Loan Bank” means each Initial Term Loan Bank, each Other Term Loan Bank and each Incremental Term Loan Bank.

“Term Borrowings” means a borrowing consisting of simultaneous Term Loans of the same type made by the appropriate Term Loan Banks.

“Term Loan Commitments” means the Initial Term Loan Commitments of the Initial Term Loan Banks at such time, the Other Term Commitments (including the 2013 Other Term Commitments) of the Other Term Loan Banks (including the 2013 Other Term Loan Banks) at such time and the Incremental Term Loan Commitments of the Incremental Term Loan Banks at such time.

“Term Loan Facilities” means the Initial Term Loan Facility, the Other Term Loan Facility and the Incremental Term Loan Facility.

“Term Loan Notes” means the Initial Term Loan Notes, the Other Term Loan Notes and the Incremental Term Loan Notes.

“Termination Date” means (i) the seventh anniversary of the Closing Date, in the case of the Initial Term Loan Facility (the “Initial Term Loan Termination Date”), (ii) the date agreed to by the Borrower, the Agent and the Incremental Term Loan Banks in the case of any Incremental Term Loan Facility (the “Incremental Term Loan Termination Date”) and (iii) the final maturity date as specified in the applicable Refinancing Amendment

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in the case of any Other Term Loans (the “Other Term Loan Termination Date”) ; provided, in each case, that if the applicable Termination Date occurs on a day that is not a Eurodollar Business Day, such Termination Date shall occur on the next succeeding Eurodollar Business Day unless such Eurodollar Business Day falls in another calendar month, in which case such Termination Date shall be the next preceding Eurodollar Business Day.

“Total Bank Exposure” at any time means the sum of the aggregate principal amount of the Loans outstanding at such time.

“Total Term Loan Commitments” means at any time in respect of a Term Loan Bank the sum of such Term Loan Bank’s Initial Term Loan Commitment at such time plus such Term Loan Bank’s Incremental Term Loan Commitment and Other Term Commitment at such time.

“Trust Preferred Securities” means, at any date:

(xxiv) any Existing Trust Preferred Securities, and

(xxv) any other equity interests in a Special Purpose Financing Subsidiary of AES (such as those known as “TECONS”, “MIPS” or “RHINOS”): (I) that are not (A) required to be redeemed or redeemable at the option of the holder thereof prior to the fifth anniversary of the Initial Term Loan Termination Date or (B) convertible into or exchangeable for (unless solely at the option of AES) equity interests referred to in clause (A) above or Debt having a scheduled maturity, or requiring any repayments or prepayments of principal or any sinking fund or similar payments in respect of principal or providing for any such repayment, prepayment, sinking fund or other payment at the option of the holder thereof prior to the fifth anniversary of the Initial Term Loan Termination Date and (II) as to which, at such date, AES has the right to defer the payment of all dividends and other distributions in respect thereof for the period of at least 19 consecutive quarters beginning at such date.

“Unfunded Liabilities” means, with respect to any Plan at any time, the amount (if any) by which (i) the value of all benefit liabilities under such Plan, determined on a plan termination basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions), all determined as of the then most recent valuation date for such Plan, but only to the extent that such excess represents a potential liability of a member of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.

“United States” means the United States of America, including the States and the District of Columbia, but excluding its territories and possessions.

“Voting Stock” means with respect to any Person, Capital Stock of any class or kind ordinarily having the power to vote for the election of directors of such Person or other Persons performing similar functions.

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“Wholly-Owned Consolidated Subsidiary” means any Consolidated Subsidiary all of the shares of Capital Stock or other ownership interests of which (except directors’ qualifying shares and shares owned by foreign nationals mandated by applicable law) are at the time directly or indirectly owned by AES.

Section 1.02 Accounting Terms and Determinations.

Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with generally accepted accounting principles as in effect from time to time, applied on a basis consistent (except for changes concurred in by the Borrower’s independent public accountants) with the most recent audited consolidated financial statements of the Borrower and its Consolidated Subsidiaries delivered to the Banks (“GAAP”); provided that, if the Borrower notifies the Agent that the Borrower wishes to amend any calculation of the “Recourse Debt to Cash Flow Ratio” to eliminate the effect of any change in generally accepted accounting principles on the operation of such calculation (or if the Agent notifies the Borrower that the Required Banks wish to amend such calculation for such purpose), then the Borrower’s compliance with such calculation shall be determined on the basis of generally accepted accounting principles in effect immediately before the relevant change in generally accepted accounting principles became effective, until either such notice is withdrawn or such calculation is amended in a manner satisfactory to the Borrower and the Required Banks.

Section 1.03 Types of Borrowing.

The term “Borrowing” denotes (a) the aggregation of Loans made (or deemed to have been made) or to be made to the Borrower by one or more Banks pursuant to Article II on the same day, all of which Loans are of the same type (subject to Article VIII) and, except in the case of Base Rate Loans, have the same initial Interest Period or (b) if the context so requires, the borrowing of such Loans. Borrowings are classified for purposes hereof by reference to the pricing of Loans comprising such Borrowing (e.g., a “Eurodollar Borrowing” is a Borrowing comprised of Eurodollar Loans). It is understood and agreed that all Borrowings will be made in Dollars.

ARTICLE II

THE CREDITS

Section 2.01 Commitment to Lend.

(a) Subject to the terms and conditions set forth herein, each Bank severally agrees to make a single Initial Term Loan to the Borrower on the Closing Date in a principal amount equal to 99.5% of such Bank’s Initial Term Loan Commitment under the Initial Term Loan Facility; provided that the principal amount of Initial Term Loans deemed to have been made hereunder shall be an amount equal to 100% of the Initial Term Loan Commitments.

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(b) Subject to the terms and conditions set forth herein and in the 2013 Amendment, each 2013 Other Term Loan Bank severally agrees to make a single 2013 Other Term Loan to the Borrower on the 2013 Amendment Effective Date in a principal amount equal to 100% of such 2013 Other Term Loan Bank’s 2013 Other Term Commitment under the 2013 Amendment; provided that the principal amount of 2013 Other Term Loans deemed to have been made hereunder and thereunder shall be an amount equal to 100% of the 2013 Other Term Commitments.

(c) The Borrowing of Term Loans shall consist of Term Loans made simultaneously by the Banks in accordance with their respective Term Loan Commitments. The Term Loans are not revolving in nature, and amounts repaid or prepaid in respect thereof may not be reborrowed.

Section 2.02 Notice of Borrowing.

(a) The Borrower shall give the Agent notice (a “Notice of Borrowing”) not later than 11:00 A.M. (New York City time) on (x) the date of each Base Rate Borrowing and (y) the third Eurodollar Business Day before each Eurodollar Borrowing, specifying:

(i) the date of such Borrowing, which shall be a Domestic Business Day in the case of a Base Rate Borrowing or a Eurodollar Business Day in the case of a Eurodollar Borrowing;

(ii) the aggregate amount of such Borrowing;

(iii) whether the Loans comprising such Borrowing are to bear interest initially at the Base Rate or the Eurodollar Rate; and

(iv) in the case of a Eurodollar Borrowing, the duration of the initial Interest Period applicable thereto, subject to the provisions of the definition of “Interest Period.”

(b) Upon receipt of a Notice of Borrowing, the Agent shall promptly notify each Bank of the contents thereof and of such Bank’s ratable share of such Borrowing and such Notice of Borrowing shall not thereafter be revocable by the Borrower.

(c) Not later than 2:00 P.M. (New York City time) on the date of each Borrowing, each Bank shall (except as provided in subsection (d) of this Section 2.02) make available its ratable share of such Borrowing, in Federal or other funds immediately available in New York City, to the Agent at its address referred to in Section 7.11. Unless the Agent determines that any applicable condition specified in Article III has not been satisfied, the Agent will make the funds so received from the Banks available to the Borrower requesting such Borrowing at the Agent’s aforesaid address.

(d) [Intentionally Omitted.]

(e) Unless the Agent shall have received notice from a Bank prior to the date of any Borrowing that such Bank will not make available to the Agent such Bank’s share of such Borrowing, the Agent may assume that such Bank has made such share available to the Agent on the date of such Borrowing in accordance with subsections (c) and (d) of this

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or such account or accounts, shall not limit or otherwise affect the obligations of the Borrower under this Agreement.

Section 2.05 Maturity of Loans.

(a) The Borrower shall repay the Initial Term Loans (i) on each Quarterly Payment Date beginning on June 15, 2011 and prior to the Initial Term Loan Termination Date in an aggregate principal amount equal to 0.25% of the initial principal amount of the Initial Term Loans and (ii) on the Initial Term Loan Termination Date in an aggregate principal amount equal to the principal amount of Initial Term Loans then outstanding (together with interest accrued thereon).

(b) On or after the 2013 Amendment Effective Date, the Borrower shall repay the 2013 Other Term Loans (i) on each Quarterly Payment Date beginning on March 15, 2013 and prior to the 2013 Other Term Loan Termination Date in an aggregate principal amount equal to 0.25% of the initial principal amount of the 2013 Other Term Loans and (ii) on the 2013 Other Term Loan Termination Date in an aggregate principal amount equal to the principal amount of 2013 Other Term Loans then outstanding (together with interest accrued thereon).

(c) Each Other Term Loan shall mature, and the principal amount thereof shall be due and payable (together with interest accrued thereon) on the Other Term Loan Termination Date in respect of such Other Term Loan Facility and each Incremental Term Loan shall mature, and the principal amount thereof shall be due and payable (together with interest accrued thereon) on the Incremental Term Loan Termination Date in respect of such Incremental Term Loan Facility.

Section 2.06 Interest Rates.

(a) Each Base Rate Loan shall bear interest on the outstanding principal amount thereof, for each day from the date such Loan is made until it becomes due, at a rate per annum equal to the Base Rate Margin applicable to such Loan plus the Base Rate for such day. Such interest shall be payable quarterly in arrears on each Quarterly Payment Date.

(b) Each Eurodollar Loan shall bear interest on the outstanding principal amount thereof, for each day during each Interest Period applicable thereto, at a rate per annum equal to the sum of the Eurodollar Margin applicable to such Loan for such day plus the Eurodollar Rate applicable to such Interest Period. Such interest shall be payable for each Interest Period on the last day thereof and, if such Interest Period is longer than three months, at intervals of three months after the first day thereof.

(c) Upon the occurrence and during the continuance of an Event of Default described in Section 6.01(a) or an Event of Default described in Section 6.01(d) or 6.01(e) with respect to the Borrower, the Borrower shall pay interest on (x) (i) the outstanding principal amount of each Base Rate Loan owing to each Bank Party, payable on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on such Base Rate Loan pursuant to Section 2.06(a) above and (ii) to the fullest extent permitted by law, the amount of any interest that is not paid when due, from the date such

32

interest thereon to the date of prepayment; provided, that in the event that, on or prior to the first anniversary of the 2013 Amendment Effective Date, the Borrower (x) makes any prepayment of 2013 Other Term Loans in connection with any Repricing Transaction or (y) effects any amendment to this Agreement resulting in a Repricing Transaction, the Borrower shall pay to the Agent, for the ratable account of each of the applicable Banks, (I) in the case of clause (x), a prepayment premium of 1% of the amount of the Term Loans being prepaid and (II) in the case of clause (y), an amount equal to 1% of the aggregate amount of the applicable Term Loans outstanding immediately prior to such amendment that were repriced pursuant to such amendment. Upon receipt of a notice of prepayment pursuant to this Section 2.10(a)(i), the Agent shall promptly notify each Bank of the contents thereof and of such Bank’s ratable share of such prepayment and such notice shall not thereafter be revocable by the Borrower.

(ii) Notwithstanding anything in any Financing Document to the contrary, the Borrower may, pursuant to the procedures and in the manner set forth on Schedule 2.10, make an offer to prepay outstanding Loans at a discount to par and make a prepayment with respect to such Loans; provided that, both at the time of any such offer and at the time of any such prepayment, no Default or Event of Default has occurred and is continuing or would result therefrom. Upon the completion of any prepayment made in connection with a transaction pursuant to this Section 2.10(a)(ii) and Schedule 2.10, the Loans subject to such prepayment shall be deemed satisfied and of no further force and effect.

(b) Mandatory. (i) The Borrower shall, on the third Domestic Business Day following the receipt by the Borrower after the Closing Date of Net Cash Proceeds from any Asset Sales, offer to prepay, on a pro rata basis, an aggregate principal amount of the Term Loans in an amount equal to the Banks’ Ratable Share of such Net Cash Proceeds and the Term Loan Banks shall have the option to accept or refuse such prepayment in accordance with the provisions set forth in Section 2.10(c).

(ii) Upon a Change of Control, the Borrower shall make an offer to prepay (a “Change of Control Prepayment”) the entire principal amount of the Term Loans (the “Change of Control Prepayment Offer”) at 101% of the aggregate principal amount thereof and the Borrower shall notify the Agent in writing of the Change of Control Prepayment Offer in writing within 30 days after the date of such Change of Control. Each such notice shall specify the date of such prepayment and provide a reasonably detailed calculation of the amount of such prepayment and include the payment date (which shall be no earlier than 30 days nor later than 60 days from the date of the Change of Control Prepayment Offer) (the “Change of Control Prepayment Date”). The Agent will promptly notify each Bank of the contents of any such prepayment notice and of such Bank’s pro rata share of the prepayment. Any Bank may elect, by delivering a written notice (an “Acceptance Notice”) no later than three Domestic Business Days prior to the Change of Control Prepayment Date, that any Change of Control Prepayment be made with respect to all or any portion of the Term Loans held by such Bank pursuant to this Section 2.10(b)(ii). If a Bank fails to deliver an Acceptance Notice within the time frame specified above, any such

35

Section 5.07 Intentionally Omitted.

Section 5.08 Use of Proceeds.

The proceeds of the Loans made under this Agreement (other than the 2013 Other Term Loans made on the 2013 Amendment Effective Date pursuant to the 2013 Amendment) will be used by the Borrower for working capital and other general corporate purposes, including, but not limited to, at the Borrower’s election, the financing of a portion of the purchase price and related expenses in connection with the Borrower’s contemplated acquisition of DPL Inc. None of such proceeds will be used, directly or indirectly, for the purpose, whether immediate, incidental or ultimate, of buying or carrying any “margin stock” within the meaning of Regulation U. The proceeds of (x) the 2013 Other Term Loans made on the 2013 Amendment Effective Date shall be used on the 2013 Amendment Effective Date to prepay in full all Term Loans outstanding hereunder as of the 2013 Amendment Effective Date (immediately prior to giving effect to the 2013 Amendment) and all other Obligations in respect thereof and fees and expenses with respect thereto, and (y) the remaining portion, if any, of the 2013 Other Term Loans made on the 2013 Amendment Effective Date shall be used to pay the fees and expenses with respect to the 2013 Transactions and for general corporate purposes.

Section 5.09 Intentionally Omitted.

Section 5.10 Negative Pledge.

(a) The Borrower shall not incur, issue, assume or guarantee any indebtedness for borrowed money represented by notes, bonds, debentures or other similar evidences of indebtedness, secured by a mortgage, pledge or other lien on any Principal Property or any capital stock or indebtedness held directly by the Borrower or any Subsidiary of the Borrower (other than assets that are part of the Creditor Group Collateral), unless (i) the Borrower secures the Term Loans equally and ratably with (or prior to) such indebtedness, so long as such indebtedness shall be so secured, or (ii) after giving effect thereto the aggregate amount of all such indebtedness so secured, together with all Attributable Debt in respect of sale and leaseback transactions involving Principal Properties, would not exceed the Secured Debt Limit.

(b) The Borrower agrees that Liens on the Creditor Group Collateral shall only secure First Priority Secured Debt (including (x) Debt under the Existing Credit Agreement and (y) Debt under this Agreement) up to an aggregate principal amount not to exceed the Secured Debt Limit.

Section 5.11 Consolidations and Mergers.

(a) The Borrower shall not consolidate with, merge with or into, or sell, convey, transfer, lease or otherwise dispose of all or substantially all of its property and assets (as an entirety or substantially as an entirety in one transaction or a series of related transactions) to, any Person (other than a consolidation with or merger with or into a Subsidiary or a sale, conveyance, transfer, lease or other disposition to a Subsidiary) or permit any Person to merge with or into the Borrower unless either (x) the Borrower shall be the

55

immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.

Section 6.02 Notice of Default.

The Agent shall give notice to the Borrower under Section 6.01(c) promptly upon being requested to do so by any Bank Party and shall thereupon notify all the Banks thereof.

ARTICLE VII

THE AGENT

Section 7.01 Appointment and Authorization.

Each of the Banks hereby irrevocably appoints (a) Bank of America to act on its behalf as the Agent hereunder and under the other Financing Documents and (b) approves and appoints Citibank, N.A. as successor to Bank of America as its Agent upon the resignation of Bank of America as Agent hereunder and under the Financing Documents and authorizes the Agent to take such actions on its behalf and to exercise such powers as are delegated to the Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Agent and the Banks, and the Borrower shall not have rights as a third party beneficiary of any of such provisions.

Section 7.02 Rights as a Bank.

The Person serving as the Agent hereunder shall have the same rights and powers in its capacity as a Bank as any other Bank and may exercise the same as though it were not the Agent and the term “Bank” or “Banks” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Agent hereunder and without any duty to account therefor to the Banks.

Section 7.03 Exculpatory Provisions.

The Agent shall not have any duties or obligations except those expressly set forth herein and in the other Financing Documents. Without limiting the generality of the foregoing, the Agent:

(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or

61

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Andrés Gluski, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of The AES Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 8, 2013

/S/ ANDRÉS GLUSKI

Name: Andrés Gluski

President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Thomas M. O’Flynn, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of The AES Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 8, 2013

/s/ THOMAS M. O’FLYNN

Name: Thomas M. O’Flynn

Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF PERIODIC FINANCIAL REPORTS

I, Andrés Gluski, President and Chief Executive Officer of The AES Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, (the “Periodic Report”) which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2) information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of The AES Corporation.

Date: May 8, 2013

/S/ ANDRÉS GLUSKI

Andrés Gluski

President and Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION OF PERIODIC FINANCIAL REPORTS

I, Thomas M. O’Flynn, Executive Vice President and Chief Financial Officer of The AES Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 (the “Periodic Report”) which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2) information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of The AES Corporation.

Date: May 8, 2013

/S/ THOMAS M. O’FLYNN

Name: Thomas M. O’Flynn

Executive Vice President and Chief Financial Officer

XML

Impairments (Tables)

3 Months Ended

Mar. 31, 2013

Impairments Tables [Abstract]

Details of Impairment of Long-Lived Assets Held and Used by Asset [Table Text Block]

	Three Months Ended
	March 31,
	2013		2012
	(in millions)
Beaver Valley	$	46	$	-
Kelanitissa		-		5
Other		2		5
Total asset impairment expense	$	48	$	10

XML

Derivative Instruments and Hedging Activities - Part 3 (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in AOCL	$ (16)	$ 25
Gains (Losses) Reclassified from AOCL into Earnings	(31)	(114)
Gains (Losses) Recognized in Earnings (ineffective portion)	(1)	(1)
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	(25)	(31)
Interest Rate Derivatives
AOCI to be recognized in next 12 months table
Accumulated Other Comprehensive Income Loss Before Tax Expected Increase Decrease Next Twelve Months	(146)
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in AOCL	(13)	11
Interest Rate Derivatives | Interest Expense [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	(32)	(32)
Gains (Losses) Recognized in Earnings (ineffective portion)	(1)	(1)
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	1	(2)
Interest Rate Derivatives | Non-regulated cost of sales
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	(1)	(2)
Interest Rate Derivatives | Net Equity In Earnings Of Affiliates [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	(2)	(1)
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	(6)	0
Interest Rate Derivatives | Gain on sale of investments [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	0	(92)
Cross Currency Swaps
AOCI to be recognized in next 12 months table
Accumulated Other Comprehensive Income Loss Before Tax Expected Increase Decrease Next Twelve Months	(11)
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in AOCL	1	14
Cross Currency Swaps | Interest Expense [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	(3)	(3)
Cross Currency Swaps | Foreign currency transaction gains (losses) [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	5	18
Foreign Currency
AOCI to be recognized in next 12 months table
Accumulated Other Comprehensive Income Loss Before Tax Expected Increase Decrease Next Twelve Months	(6)
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in AOCL	1	6
Foreign Currency | Foreign currency transaction gains (losses) [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	2	0
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	6	(38)
Foreign Currency | Net Equity In Earnings Of Affiliates [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	(3)	0
Commodity & Other
AOCI to be recognized in next 12 months table
Accumulated Other Comprehensive Income Loss Before Tax Expected Increase Decrease Next Twelve Months	(9)
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in AOCL	(5)	(6)
Commodity & Other | Non-regulated revenue
Gain Loss By Type Of Derivative Tables
Gains (Losses) Reclassified from AOCL into Earnings	0	(2)
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	(21)	14
Commodity & Other | Non-regulated cost of sales
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	1	3
Commodity & Other | Regulated Revenue [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	(3)	(4)
Commodity & Other | Regulated Cost Of Sales [Member]
Gain Loss By Type Of Derivative Tables
Gains (Losses) Recognized in Earnings (not designated as hedging instruments)	$ 0	$ (4)

XML

Fair Value (Nonrecurring Measurements) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Asset Impairment Charges	$ 48	$ 10
Other non-operating expense	0	49
Long Lived Assets Held And Used [Member] | Beaver Valley [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Asset Impairment Charges	46
Long Lived Assets Held And Used [Member] | Kelanitissa [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Asset Impairment Charges		5
Discontinued operations and held for sale businesses [Member] | Ukraine Utilities [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	143
Other non-operating expense	38
Equity Method Affiliate [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Other non-operating expense		49
Carrying Amount | Long Lived Assets Held And Used [Member] | Beaver Valley [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	61
Carrying Amount | Long Lived Assets Held And Used [Member] | Kelanitissa [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		22
Carrying Amount | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	25
Carrying Amount | Equity Method Affiliate [Member]
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		204
Fair Value | Level 3
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	40
Fair Value | Long Lived Assets Held And Used [Member] | Beaver Valley [Member] | Level 1
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	0
Fair Value | Long Lived Assets Held And Used [Member] | Beaver Valley [Member] | Level 2
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	0
Fair Value | Long Lived Assets Held And Used [Member] | Beaver Valley [Member] | Level 3
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	15
Fair Value | Long Lived Assets Held And Used [Member] | Kelanitissa [Member] | Level 1
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		0
Fair Value | Long Lived Assets Held And Used [Member] | Kelanitissa [Member] | Level 2
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		0
Fair Value | Long Lived Assets Held And Used [Member] | Kelanitissa [Member] | Level 3
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		17
Fair Value | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member] | Level 1
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	0
Fair Value | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member] | Level 2
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	0
Fair Value | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member] | Level 3
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	25
Fair Value | Discontinued operations and held for sale businesses [Member] | Ukraine Utilities [Member] | Level 1
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	0
Fair Value | Discontinued operations and held for sale businesses [Member] | Ukraine Utilities [Member] | Level 2
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	109
Fair Value | Discontinued operations and held for sale businesses [Member] | Ukraine Utilities [Member] | Level 3
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring	0
Fair Value | Equity Method Affiliate [Member] | Level 1
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		0
Fair Value | Equity Method Affiliate [Member] | Level 2
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		155
Fair Value | Equity Method Affiliate [Member] | Level 3
Fair Value Assets And Liabilities Measured On Nonrecurring Basis [Abstract]
Fair Value, Nonrecurring		$ 0

XML

Derivative Insturments and Hedging Activities - Part 5 (Details) (DPL Subsidiary [Member], USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
DPL Subsidiary [Member]
Credit Risk-Related Contingent Features [Line Items]
Net liability position, derivative transactions	$ 23	$ 13
Collateral posted for derivative transactions	14	5
Cash Collateral Received From Counterparties	0	0
Additional collateral that could have been required	$ 5	$ 2

XML

Fair Value (Level 3 Reconciliation) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Balance at beginning of period	$ (396)	$ (148)
Included in earnings	(11)	5
Included in other comprehensive income	(17)	15
Included in regulatory (assets) liabilities	(1)	0
Settlements	22	8
Transfers of assets (liabilities) into Level 3		(28)
Transfers of (assets) liabilities out of Level 3	334	26
Balance at end of period	(69)	(122)
Total gains/(losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets and liabilities held at the end of the period	(12)	6
Interest Rate Derivatives
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Balance at beginning of period	(412)	(128)
Included in earnings	0	(1)
Included in other comprehensive income	(17)	1
Included in regulatory (assets) liabilities	0	0
Settlements	23	6
Transfers of assets (liabilities) into Level 3		(28)
Transfers of (assets) liabilities out of Level 3	334	26
Balance at end of period	(72)	(124)
Total gains/(losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets and liabilities held at the end of the period	0	0
Cross Currency Swaps
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Balance at beginning of period		(18)
Included in earnings		0
Included in other comprehensive income		14
Included in regulatory (assets) liabilities		0
Settlements		4
Transfers of assets (liabilities) into Level 3		0
Transfers of (assets) liabilities out of Level 3		0
Balance at end of period		0
Total gains/(losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets and liabilities held at the end of the period		0
Foreign Currency
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Balance at beginning of period	73	51
Included in earnings	(1)	(2)
Included in other comprehensive income	0	0
Included in regulatory (assets) liabilities	0	0
Settlements	(1)	(1)
Transfers of assets (liabilities) into Level 3		0
Transfers of (assets) liabilities out of Level 3	0	0
Balance at end of period	71	48
Total gains/(losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets and liabilities held at the end of the period	(2)	(3)
Commodity & Other
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Balance at beginning of period	(57)	(53)
Included in earnings	(10)	8
Included in other comprehensive income	0	0
Included in regulatory (assets) liabilities	(1)	0
Settlements	0	(1)
Transfers of assets (liabilities) into Level 3		0
Transfers of (assets) liabilities out of Level 3	0	0
Balance at end of period	(68)	(46)
Total gains/(losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets and liabilities held at the end of the period	$ (10)	$ 9

XML

Non-Recourse Debt (Tables)

3 Months Ended

Mar. 31, 2013

Debt Tables [Abstract]

Debt In Default Table

	Primary Nature	March 31, 2013
Subsidiary	of Default	Default Amount		Net Assets
		(in millions)
Maritza	Covenant	$	819	$	576
Sonel	Covenant		264		361
Kavarna	Covenant		196		82
Changuinola	Covenant		395		249
Saurashtra	Covenant		25		15
Total		$	1,304

XML

Non-Recourse Debt (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Nonrecourse Debt Default [Line Items]
Default	$ 1,304
Gains Losses On Extinguishment Of Debt	(47)	0
Sonel [Member]
Nonrecourse Debt Default [Line Items]
Net Assets	361
Maritza [Member]
Nonrecourse Debt Default [Line Items]
Net Assets	576
Saurashtra [Member]
Nonrecourse Debt Default [Line Items]
Net Assets	15
Kavarna [Member]
Nonrecourse Debt Default [Line Items]
Net Assets	82
Tiete [Member]
Nonrecourse Debt Default [Line Items]
Debt Instrument, Increase, Additional Borrowings	251
Debt Instrument, Decrease, Repayments	60
El Salvador [Member]
Nonrecourse Debt Default [Line Items]
Debt Instrument, Increase, Additional Borrowings	310
Debt Instrument, Decrease, Repayments	150
Sul [Member]
Nonrecourse Debt Default [Line Items]
Debt Instrument, Increase, Additional Borrowings	150
Debt Instrument, Decrease, Repayments	34
Mong Duong [Member]
Nonrecourse Debt Default [Line Items]
Debt Instrument, Increase, Additional Borrowings	119
Masinloc [Member]
Nonrecourse Debt Default [Line Items]
Debt Instrument, Increase, Additional Borrowings	500
Gains Losses On Extinguishment Of Debt	(43)
Extinguishment of Debt, Amount	500
Covenant Violation [Member] | Sonel [Member]
Nonrecourse Debt Default [Line Items]
Default	264
Covenant Violation [Member] | Maritza [Member]
Nonrecourse Debt Default [Line Items]
Default	819
Covenant Violation [Member] | Kavarna [Member]
Nonrecourse Debt Default [Line Items]
Default	196
Payment Default [Member] | Saurashtra [Member]
Nonrecourse Debt Default [Line Items]
Default	$ 25

XML

Earnings Per Share

3 Months Ended

Mar. 31, 2013

EARNINGS PER SHARE

17. EARNINGS PER SHARE

Basic and diluted earnings per share are based on the weighted average number of shares of common stock and potential common stock outstanding during the period. Potential common stock, for purposes of determining diluted earnings per share, includes the effects of dilutive restricted stock units, stock options and convertible securities. The effect of such potential common stock is computed using the treasury stock method or the if-converted method, as applicable.

 The following tables present a reconciliation of the numerator and denominator of the basic and diluted earnings per share computation for income from continuing operations for the threemonths ended March 31, 2013 and 2012. In the table below, income represents the numerator and weighted-average shares represent the denominator:

			Three Months Ended March 31,
			2013					2012
			Income		Shares	$ per Share		Income		Shares	$ per Share
			(in millions except per share data)
BASIC EARNINGS PER SHARE
	Income from continuing operations attributable
		to The AES Corporation common stockholders	$	106	745	$	0.14	$	341	766	$	0.45
EFFECT OF DILUTIVE SECURITIES
	Convertible securities			-	-		-		6	15		-
	Stock options			-	1		-		-	1		-
	Restricted stock units			-	3		-		-	3		(0.01)
DILUTED EARNINGS PER SHARE			$	106	749	$	0.14	$	347	785	$	0.44

The calculation of diluted earnings per share excluded 8 and 7 million options outstanding at March 31, 2013 and 2012, respectively, that could potentially dilute basic earnings per share in the future. These options were not included in the computation of diluted earnings per share because the exercise price of those options exceeded the average market price during the related period.

The calculation of diluted earnings per share also excluded 1 and 2million restricted stock units outstanding at March 31, 2013 and 2012, respectively, that could potentially dilute basic earnings per share in the future. These restricted stock units were not included in the computation of diluted earnings per share because the average amount of compensation cost per share attributed to future service and not yet recognized exceeded the average market price during the related period and thus to include the restricted units would have been anti-dilutive.

For the three months ended March 31, 2013 all 15 million convertible debentures were omitted from the earnings per share calculation because they were anti-dilutive. For the three months ended March 31, 2012, all convertible debentures were included in the earnings per share calculation.

During the three months ended March 31, 2013, 1 million shares of common stock were issued under the Company's profit sharing plan.

XML

Fair Value (Instruments Not Measured at Fair Value) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Carrying Amount
Financial Instruments Not Measured At Fair Value In the Condensed Consolidated Balance Sheets [Abstract]
Long-term receivables	$ 295	$ 304
Non-recourse debt	15,923	15,383
Recourse debt	5,961	5,962
Fair Value
Financial Instruments Not Measured At Fair Value In the Condensed Consolidated Balance Sheets [Abstract]
Long-term receivables	167	188
Non-recourse debt	16,416	16,110
Recourse debt	6,724	6,628
Value Added Tax Receivable, Noncurrent	53	55
Fair Value | Level 1
Financial Instruments Not Measured At Fair Value In the Condensed Consolidated Balance Sheets [Abstract]
Long-term receivables	0	0
Non-recourse debt	0	0
Recourse debt	0	0
Fair Value | Level 2
Financial Instruments Not Measured At Fair Value In the Condensed Consolidated Balance Sheets [Abstract]
Long-term receivables	0	0
Non-recourse debt	14,212	13,811
Recourse debt	6,724	6,628
Fair Value | Level 3
Financial Instruments Not Measured At Fair Value In the Condensed Consolidated Balance Sheets [Abstract]
Long-term receivables	167	188
Non-recourse debt	2,204	2,299
Recourse debt	$ 0	$ 0

XML

Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2013

Earnings Per Share Tables [Abstract]

Earnings Per Share Basic And Diluted Table

			Three Months Ended March 31,
			2013					2012
			Income		Shares	$ per Share		Income		Shares	$ per Share
			(in millions except per share data)
BASIC EARNINGS PER SHARE
	Income from continuing operations attributable
		to The AES Corporation common stockholders	$	106	745	$	0.14	$	341	766	$	0.45
EFFECT OF DILUTIVE SECURITIES
	Convertible securities			-	-		-		6	15		-
	Stock options			-	1		-		-	1		-
	Restricted stock units			-	3		-		-	3		(0.01)
DILUTED EARNINGS PER SHARE			$	106	749	$	0.14	$	347	785	$	0.44

XML

Segments (Tables)

3 Months Ended

Mar. 31, 2013

Segments Tables [Abstract]

Revenue By Segment Table

Revenue
Three Months Ended	Total Revenue				Intersegment				External Revenue
March 31,	2013		2012		2013		2012		2013		2012
	(in millions)
US - Generation	$	170	$	198	$	-	$	-	$	170	$	198
US - Utilities		722		732		-		-		722		732
Andes - Generation		691		734		-		(9)		691		725
Brazil - Generation		386		305		(280)		(282)		106		23
Brazil - Utilities		1,323		1,531		-		-		1,323		1,531
MCAC - Generation		458		393		(1)		(1)		457		392
EMEA - Generation		351		477		(8)		(9)		343		468
Asia - Generation		134		182		-		-		134		182
Corporate and Other		320		336		(1)		(1)		319		335
Total Revenue	$	4,555	$	4,888	$	(290)	$	(302)	$	4,265	$	4,586

Adjusted Gross Margin by Segment Table

Adjusted Pre-Tax Contribution(1)	Total Adjusted								External Adjusted
Three Months Ended	Pre-tax Contribution				Intersegment				Pre-tax Contribution
March 31,	2013		2012		2013		2012		2013		2012
	(in millions)
US - Generation	$	65	$	36	$	2	$	11	$	67	$	47
US - Utilities		70		57		-		-		70		57
Andes - Generation		80		111		3		(5)		83		106
Brazil - Generation		40		52		(67)		(68)		(27)		(16)
Brazil - Utilities		2		56		45		46		47		102
MCAC - Generation		48		71		3		2		51		73
EMEA - Generation		94		187		(2)		(14)		92		173
Asia - Generation		31		32		1		-		32		32
Corporate and Other		(165)		(189)		15		28		(150)		(161)
Total		265		413		-		-		265		413
Reconciliation to Income from Continuing Operations before Taxes and Equity earnings of Affiliates:
Non-GAAP Adjustments:
Unrealized derivative losses										(13)		(30)
Unrealized foreign currency gains (losses)										(27)		29
Disposition/acquisition gains										3		178
Impairment losses										(48)		(58)
Debt retirement losses										(43)		-
Pre-tax contribution										137		532
Add: income from continuing operations before taxes, attributable to noncontrolling interests										166		250
Less: Net equity in earnings of affiliates										4		13
Income from continuing operations before taxes and equity in earnings of affiliates									$	299	$	769

Assets By Segment Table

	Total Assets
	March 31, 2013		December 31, 2012
	(in millions)
Assets
US - Generation	$	3,184	$	3,259
US - Utilities		7,576		7,534
Andes - Generation		6,554		6,619
Brazil - Generation		1,867		1,590
Brazil - Utilities		8,424		8,120
MCAC - Generation		4,440		4,293
EMEA - Generation		4,568		4,578
Asia - Generation		2,702		2,625
Discontinued businesses		173		202
Corporate and Other & eliminations		3,230		3,010
Total assets	$	42,718	$	41,830

XML

Derivative Instruments and Hedging Activities - Part 1 (Details) In Millions, unless otherwise specified	3 Months Ended													3 Months Ended					3 Months Ended
	Mar. 31, 2013 Interest Rate Derivatives Libor USD [Member]	Mar. 31, 2013 Interest Rate Derivatives Euribor EUR [Member]	Mar. 31, 2013 Interest Rate Derivatives Libor GBP [Member]	Mar. 31, 2013 Interest Rate Derivatives Current Notional [Member] Libor USD [Member] USD ($)	Mar. 31, 2013 Interest Rate Derivatives Current Notional [Member] Euribor EUR [Member] USD ($)	Mar. 31, 2013 Interest Rate Derivatives Current Notional [Member] Euribor EUR [Member] EUR (€)	Mar. 31, 2013 Interest Rate Derivatives Current Notional [Member] Libor GBP [Member] USD ($)	Mar. 31, 2013 Interest Rate Derivatives Current Notional [Member] Libor GBP [Member] GBP (£)	Mar. 31, 2013 Interest Rate Derivatives Maximum Libor USD [Member] USD ($)	Mar. 31, 2013 Interest Rate Derivatives Maximum Euribor EUR [Member] USD ($)	Mar. 31, 2013 Interest Rate Derivatives Maximum Euribor EUR [Member] EUR (€)	Mar. 31, 2013 Interest Rate Derivatives Maximum Libor GBP [Member] USD ($)	Mar. 31, 2013 Interest Rate Derivatives Maximum Libor GBP [Member] GBP (£)	Mar. 31, 2013 Cross Currency Swaps Chilean Unidad De Fomento CLF [Member]	Mar. 31, 2013 Cross Currency Swaps Current Notional [Member] Chilean Unidad De Fomento CLF [Member] USD ($)	Mar. 31, 2013 Cross Currency Swaps Current Notional [Member] Chilean Unidad De Fomento CLF [Member] CLF	Mar. 31, 2013 Cross Currency Swaps Maximum Chilean Unidad De Fomento CLF [Member] USD ($)	Mar. 31, 2013 Cross Currency Swaps Maximum Chilean Unidad De Fomento CLF [Member] CLF	Mar. 31, 2013 Foreign Currency Options Euro EUR [Member] USD ($)	Mar. 31, 2013 Foreign Currency Options Euro EUR [Member] EUR (€)	Mar. 31, 2013 Foreign Currency Options Brazilian Real BRL [Member] USD ($)	Mar. 31, 2013 Foreign Currency Options Brazilian Real BRL [Member] BRL	Mar. 31, 2013 Foreign Currency Options British Pound GBP [Member] USD ($)	Mar. 31, 2013 Foreign Currency Options British Pound GBP [Member] GBP (£)	Mar. 31, 2013 Foreign Currency Options Chilean Peso CLP [Member] USD ($)	Mar. 31, 2013 Foreign Currency Options Chilean Peso CLP [Member] CLP	Mar. 31, 2013 Foreign Currency Options Colombian Peso COP [Member] USD ($)	Mar. 31, 2013 Foreign Currency Options Colombian Peso COP [Member] COP	Mar. 31, 2013 Foreign Currency Options Argentine Peso ARS [Member] USD ($)	Mar. 31, 2013 Foreign Currency Options Argentine Peso ARS [Member] ARS	Mar. 31, 2013 Embedded Foreign Currency Derivatives Euro EUR [Member] USD ($)	Mar. 31, 2013 Embedded Foreign Currency Derivatives Euro EUR [Member] EUR (€)	Mar. 31, 2013 Embedded Foreign Currency Derivatives Argentine Peso ARS [Member] USD ($)	Mar. 31, 2013 Embedded Foreign Currency Derivatives Argentine Peso ARS [Member] ARS	Mar. 31, 2013 Embedded Foreign Currency Derivatives Kazakhstani Tenge KZT [Member] USD ($)	Mar. 31, 2013 Embedded Foreign Currency Derivatives Kazakhstani Tenge KZT [Member] KZT	Mar. 31, 2013 Commodity Derivatives Aluminum M Wh [Member] MWh	Mar. 31, 2013 Commodity Derivatives Power MWh [Member] MWh
Derivative Tables [Line Items]
Notional Amount Of Interest Rate Derivatives				$ 3,451	$ 776	€ 605	$ 105	£ 69	$ 4,226	$ 776	€ 605	$ 105	£ 69
Weighted Average Remaining Term	9 years	9 years	13 years											9 years																	10 years	10 years	11 years	11 years	5 years	5 years	7 years	3 years
Weighted Average Remaining Term (string type)																			<1	<1	<1	<1	<1	<1	<1	<1	<1	<1	<1	<1
% of Debt Currently Hedged by Index	70.00%	67.00%	83.00%											85.00%
Notional Amount Of Foreign Currency Derivatives															271		271		41	29	118	240	5	3	166	80,558	28	53,208	14	83	2	2	169	829	7	1,009
Notional (CLF)																6		6
Notional (MWh)																																					14,000,000	6,000,000

XML

Earnings Per Share (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
BASIC EARNINGS PER SHARE
Income (loss) from continuing operations attributable to The AES Corporation common stockholders (Income)	$ 106	$ 341
Income (loss) from continuing operations attributable to The AES Corporation common stockholders (Shares)	745	766
Income from continuing operations attributable to The AES Corporation common stockholders, net of tax	$ 0.14	$ 0.45
EFFECT OF DILUTIVE SECURITIES
Convertible securities (Income)		6
Convertible securities (Shares)		15
Convertible securities (Per Share)		$ 0
Stock options (Shares)	1	1
Restricted stock units (Shares)	3	3
Restricted stock units (Per Share)	$ 0	$ (0.01)
DILUTED EARNINGS PER SHARE (INCOME)	$ 106	$ 347
DILUTED EARNINGS PER SHARE (SHARES)	749	785
Diluted Earnings Per Share	$ 0.14	$ 0.44
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares of common stock issued under the Company's profit sharing plan	1
Stock Options [Member] | Exercise price exceeds market price [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Additional options outstanding that could potentially dilute EPS in the future	8	7
Restricted Stock Units (RSUs) [Member] | Anti-dilutive [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Additional options outstanding that could potentially dilute EPS in the future	1	2

XML

Segments (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013 MWh	Mar. 31, 2012	Dec. 31, 2012
Segment Reporting Information [Line Items]
Generation Capacity (MW)	125
Revenue
Total Revenue	$ 4,555	$ 4,888
Intersegment	(290)	(302)
External Revenue	4,265	4,586
Adjusted PTC
Adjusted Pre-Tax Contribution	265	413
Intersegment	0	0
External Adjusted Pre-Tax Contribution	265	413
Reconciliation To Income From Continuing Operations Before Taxes
Unrealized derivatives gains (losses)	(13)	(30)
Unrealized foreign currency gains (losses)	(27)	29
Dispositions/acquisitions gains	3	178
Impairment losses	(48)	(58)
Debt retirement losses	(43)	0
Pre-tax contribution	137	532
Add: Income from continuing operations before taxes, attributable to noncontrolling interests	166	250
Less: Net equity in earnings of affiliates	4	13
INCOME FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN EARNINGS OF AFFILIATES	299	769
Assets
Total Assets	42,718		41,830
US - Generation [Member]
Revenue
Total Revenue	170	198
Intersegment	0	0
External Revenue	170	198
Adjusted PTC
Adjusted Pre-Tax Contribution	65	36
Intersegment	2	11
External Adjusted Pre-Tax Contribution	67	47
Assets
Total Assets	3,184		3,259
US - Utilities [Member]
Revenue
Total Revenue	722	732
Intersegment	0	0
External Revenue	722	732
Adjusted PTC
Adjusted Pre-Tax Contribution	70	57
Intersegment	0	0
External Adjusted Pre-Tax Contribution	70	57
Assets
Total Assets	7,576		7,534
Andes - Generation [Member]
Revenue
Total Revenue	691	734
Intersegment	0	(9)
External Revenue	691	725
Adjusted PTC
Adjusted Pre-Tax Contribution	80	111
Intersegment	3	(5)
External Adjusted Pre-Tax Contribution	83	106
Assets
Total Assets	6,554		6,619
Brazil - Generation [Member]
Revenue
Total Revenue	386	305
Intersegment	(280)	(282)
External Revenue	106	23
Adjusted PTC
Adjusted Pre-Tax Contribution	40	52
Intersegment	(67)	(68)
External Adjusted Pre-Tax Contribution	(27)	(16)
Assets
Total Assets	1,867		1,590
Brazil - Utilities [Member]
Revenue
Total Revenue	1,323	1,531
Intersegment	0	0
External Revenue	1,323	1,531
Adjusted PTC
Adjusted Pre-Tax Contribution	2	56
Intersegment	45	46
External Adjusted Pre-Tax Contribution	47	102
Assets
Total Assets	8,424		8,120
MCAC - Generation [Member]
Revenue
Total Revenue	458	393
Intersegment	(1)	(1)
External Revenue	457	392
Adjusted PTC
Adjusted Pre-Tax Contribution	48	71
Intersegment	3	2
External Adjusted Pre-Tax Contribution	51	73
Assets
Total Assets	4,440		4,293
EMEA - Generation [Member]
Revenue
Total Revenue	351	477
Intersegment	(8)	(9)
External Revenue	343	468
Adjusted PTC
Adjusted Pre-Tax Contribution	94	187
Intersegment	(2)	(14)
External Adjusted Pre-Tax Contribution	92	173
Assets
Total Assets	4,568		4,578
Asia - Generation [Member]
Revenue
Total Revenue	134	182
Intersegment	0	0
External Revenue	134	182
Adjusted PTC
Adjusted Pre-Tax Contribution	31	32
Intersegment	1	0
External Adjusted Pre-Tax Contribution	32	32
Assets
Total Assets	2,702		2,625
Segment Discontinued Operations [Member]
Assets
Total Assets	173		202
Corporate Other And Other Eliminations [Member]
Revenue
Total Revenue	320	336
Intersegment	(1)	(1)
External Revenue	319	335
Adjusted PTC
Adjusted Pre-Tax Contribution	(165)	(189)
Intersegment	15	28
External Adjusted Pre-Tax Contribution	(150)	(161)
Assets
Total Assets	$ 3,230		$ 3,010

XML

Fair Value (Quantitative Information) (Details) (USD $)	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2012	Dec. 31, 2011
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Fair Value Measurement With Unobservable Inputs Reconciliation Recurring Basis Assets Liabilities Value	$ (69,000,000)	$ (396,000,000)	$ (122,000,000)	$ (148,000,000)
Interest Rate Derivatives
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Fair Value Measurement With Unobservable Inputs Reconciliation Recurring Basis Assets Liabilities Value	(72,000,000)	(412,000,000)	(124,000,000)	(128,000,000)
Interest Rate Derivatives | Minimum
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Subsidiaries' credit risk	2.15%
Interest Rate Derivatives | Maximum
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Subsidiaries' credit risk	9.03%
Interest Rate Derivatives | Weighted Average
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Subsidiaries' credit risk	4.35%
Foreign Currency Embedded Derivative Argentine Peso [Member]
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Fair Value Measurement With Unobservable Inputs Reconciliation Recurring Basis Assets Liabilities Value	70,000,000
Foreign Currency Embedded Derivative Argentine Peso [Member] | Minimum
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Argentine Peso to U.S. Dollar currency exchange rate after 2 years	14.4
Foreign Currency Embedded Derivative Argentine Peso [Member] | Maximum
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Argentine Peso to U.S. Dollar currency exchange rate after 2 years	21.2
Foreign Currency Embedded Derivative Argentine Peso [Member] | Weighted Average
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Argentine Peso to U.S. Dollar currency exchange rate after 2 years	17.7
Commodity And Other Derivative Other [Member]
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Fair Value Measurement With Unobservable Inputs Reconciliation Recurring Basis Assets Liabilities Value	(2,000,000)
Commodity And Other Embedded Derivative Aluminum [Member]
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Fair Value Measurement With Unobservable Inputs Reconciliation Recurring Basis Assets Liabilities Value	(65,000,000)
Commodity And Other Embedded Derivative Aluminum [Member] | Minimum
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Market Price of Power for Customer in Cameroon (per KWh)	0.06
Commodity And Other Embedded Derivative Aluminum [Member] | Maximum
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Market Price of Power for Customer in Cameroon (per KWh)	0.14
Commodity And Other Embedded Derivative Aluminum [Member] | Weighted Average
Fair Value Derivative Assets Liabilities Measured On Recurring Basis Unobservable Inputs [Abstract]
Market Price of Power for Customer in Cameroon (per KWh)	$ 0.12

XML

Financial Statement Presentation

3 Months Ended

Mar. 31, 2013

FINANCIAL STATEMENT PRESENTATION

1. FINANCIAL STATEMENT PRESENTATION

The prior period condensed consolidated financial statements in this Quarterly Report on Form 10-Q (“Form 10-Q”) have been reclassified to reflect the businesses held for sale and discontinued operations as discussed in Note 15—Discontinued Operations and Held for Sale Businesses.

Consolidation

In this Quarterly Report the terms “AES”, “the Company”, “us” or “we” refer to the consolidated entity including its subsidiaries and affiliates. The terms “The AES Corporation”, “the Parent” or “the Parent Company” refer only to the publicly-held holding company, The AES Corporation, excluding its subsidiaries and affiliates. Furthermore, variable interest entities (“VIEs”) in which the Company has a variable interest have been consolidated where the Company is the primary beneficiary. Investments in which the Company has the ability to exercise significant influence, but not control, are accounted for using the equity method of accounting. All intercompany transactions and balances have been eliminated in consolidation.

Interim Financial Presentation

The accompanying unaudited condensed consolidated financial statements and footnotes have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification, for interim financial information and Article 10 of Regulation S-X issued by the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by U.S. GAAP for annual fiscal reporting periods. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, comprehensive income and cash flows. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of results that may be expected for the year ending December 31, 2013. The accompanying condensed consolidated financial statements are unaudited and should be read in conjunction with the 2012 audited consolidated financial statements and notes thereto, which are included in the 2012 Form 10-K filed with the SEC on February 26, 2013 (the “2012 Form 10-K”).

Accounting Pronouncements Issued But Not Yet Effective

The following accounting standard has been issued, but is not yet effective for, and has not been adopted by AES.

ASU No. 2013-05,Foreign Currency Matters (Topic 830),“Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.”

In March 2013, the FASB issued ASU No. 2013-05, which requires an entity to release any related cumulative translation adjustment into net income when it ceases to have a controlling financial interest in a subsidiary or group of assets that is a business (other than a sale of in-substance real estate) within a foreign entity. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided.For an equity method investment that is a foreign entity, the partial sale guidance still applies. As such, a pro rata portion of the cumulative translation adjustment should be released into net income upon a partial sale of such an equity method investment. In those instances, the cumulative translation adjustment is released into net income only if the partial sale represents a complete or substantially complete liquidation of the foreign entity that contains the equity method investment. The amendments are effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU No. 2013-05 on the Company's financial position, results of operations, and cash flows.

XML

Other Income and Expense (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Component Of Other Income [Line Items]
Total other income	$ 68	$ 18
Component Of Operating Other Cost And Expense [Line Items]
Total other expense	75	28
Loss On Sale And Disposal Of Assets [Member]
Component Of Operating Other Cost And Expense [Line Items]
Total other expense	15	24
Loss On Extinguishment Of Debt [Member]
Component Of Operating Other Cost And Expense [Line Items]
Total other expense	47	0
Contract termination
Component Of Operating Other Cost And Expense [Line Items]
Total other expense	7	0
Other Member
Component Of Operating Other Cost And Expense [Line Items]
Total other expense	6	4
Contract termination
Component Of Other Income [Line Items]
Total other income	60	0
Gain on sale of assets
Component Of Other Income [Line Items]
Total other income	1	2
Other Income Other [Member]
Component Of Other Income [Line Items]
Total other income	$ 7	$ 16

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Financial Statement Presentation (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013
Consolidation Disclosure [Abstract]
Proceeds From Sale Of New York Plants	$ 240

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Fair Value (Tables)

3 Months Ended

Mar. 31, 2013

Fair Value Disclosure Tables [Abstract]

Fair value hierarchy for recurring measurements table

			March 31, 2013								December 31, 2012
			Level 1		Level 2		Level 3			Total	Level 1		Level 2		Level 3			Total
Assets			(in millions)
AVAILABLE-FOR-SALE:(1)
	Debt securities:
		Unsecured debentures	$	-	$	615	$	-	$	615	$	-	$	448	$	-	$	448
		Certificates of deposit		-		137		-		137		-		143		-		143
		Government debt securities		-		28		-		28		-		34		-		34
		Subtotal		-		780		-		780		-		625		-		625
	Equity securities:
		Mutual funds		-		57		-		57		-		56		-		56
		Subtotal		-		57		-		57		-		56		-		56
	Total available-for-sale			-		837		-		837		-		681		-		681
TRADING:
	Equity securities:
		Mutual funds		12		-		-		12		12		-		-		12
	Total trading			12		-		-		12		12		-		-		12
DERIVATIVES:
	Interest rate derivatives			-		2		-		2		-	$	2	$	-		2
	Cross currency derivatives			-		8		-		8		-		6		-		6
	Foreign currency derivatives			-		6		82		88		-		2		79		81
	Commodity derivatives			-		6		1		7		-		8		3		11
		Total derivatives		-		22		83		105		-		18		82		100
TOTAL ASSETS			$	12	$	859	$	83	$	954	$	12	$	699	$	82	$	793
Liabilities
DERIVATIVES:
	Interest rate derivatives		$	-	$	469	$	72	$	541	$	-	$	153	$	412	$	565
	Cross currency derivatives			-		3		-		3		-		6		-		6
	Foreign currency derivatives			-		7		11		18		-		7		7		14
	Commodity derivatives			-		24		69		93		-		13		59		72
		Total derivatives		-		503		152		655		-		179		478		657
TOTAL LIABILITIES			$	-	$	503	$	152	$	655	$	-	$	179	$	478	$	657

Derivatives Level 3 Rollforward Table

						Three Months Ended March 31, 2013
						Interest		Foreign
						Rate		Currency		Commodity		Total
			(in millions)
Balance at January 1						$	(412)	$	73	$	(57)	$	(396)
	Total gains (losses) (realized and unrealized):
		Included in earnings					-		(1)		(10)		(11)
		Included in other comprehensive income					(17)		-		-		(17)
		Included in regulatory (assets) liabilities					-		-		(1)		(1)
	Settlements						23		(1)		-		22
	Transfers of (assets) liabilities out of Level 3						334		-		-		334
Balance at March 31						$	(72)	$	71	$	(68)	$	(69)
Total gains (losses) for the period included in earnings
	attributable to the change in unrealized gains (losses)
	relating to assets and liabilities held at the end of the
	period					$	-	$	(2)	$	(10)	$	(12)
				Three Months Ended March 31, 2012
				Interest		Cross		Foreign
				Rate		Currency		Currency		Commodity		Total
			(in millions)
Balance at January 1				$	(128)	$	(18)	$	51	$	(53)	$	(148)
	Total gains (losses) (realized and unrealized):
		Included in earnings			(1)		-		(2)		8		5
		Included in other comprehensive income			1		14		-		-		15
		Included in regulatory (assets) liabilities			-		-		-		-		-
	Settlements				6		4		(1)		(1)		8
	Transfers of assets (liabilities) into Level 3				(28)		-		-		-		(28)
	Transfers of (assets) liabilities out of Level 3				26		-		-		-		26
Balance at March 31				$	(124)	$	-	$	48	$	(46)	$	(122)
Total gains (losses) for the period included in earnings
	attributable to the change in unrealized gains (losses)
	relating to assets and liabilities held at the end of the
	period			$	-	$	-	$	(3)	$	9	$	6

Signficant unobservable inputs, recurring

						Amount or Range
Type of Derivative			Fair Value	Unobservable Input		(Weighted Average)
		(in millions)
Interest rate		$	(72)	Subsidiaries' credit spreads		2.15% - 9.03% (4.35%)
Foreign currency:
	Embedded derivative - Argentine Peso		70	Argentine Peso to U.S. Dollar
					currency exchange rate after 3 years	14.4 - 21.2 (17.7)
Commodity:
	Embedded derivative - Aluminum		(65)	Market price of power for
					customer in Cameroon (per KWh)	$0.06 - $0.14 ($0.12)
Other			(2)
Total		$	(69)

Fair value hierarchy for nonrecurring measurements table

			Three Months Ended March 31, 2013
			Carrying		Fair Value						Gross
			Amount		Level 1		Level 2		Level 3		Loss
Assets			(in millions)
	Long-lived assets held and used:(1)
		Beaver Valley	$	61	$	-	$	-	$	15	$	46
	Long-lived assets held for sale:(1)
		Wind turbines		25		-		-		25		-
	Discontinued operations and held for sale businesses:(2)
		Ukraine utilities		143		-		109		-		38
	Goodwill
			Three Months Ended March 31, 2012
			Carrying		Fair Value						Gross
			Amount		Level 1		Level 2		Level 3		Loss
Assets			(in millions)
	Long-lived assets held and used:(1)
		Kelanitissa		22		-		-		17		5
	Equity method investments(3)			204		-		155		-		49

Significant unobservable inputs, nonrecurring

		Fair Value		Valuation Technique	Unobservable Input		Range (Weighted Average)
		(in millions)					($ in millions)
Long-lived assets held and used:
	Beaver Valley	$	15	Discounted
				cash flow	Annual revenue growth		3% to 45% (19%)
					Annual pretax operating margin		-42% to 41% (25%)
					Weighted average cost of capital		7%
Long-lived assets held for sale:
	Wind turbines		25	Market
				Approach	Indicative offer prices	$	$12 to $38 (25)
Total		$	40

Financial instruments not measured at fair value in the condensed consolidated balance sheets

		Carrying		Fair Value
March 31, 2013		Amount			Total	Level 1		Level 2		Level 3
		(in millions)
Assets
	Accounts receivable - noncurrent(1)	$	295	$	167	$	-	$	-	$	167
Liabilities
	Non-recourse debt		15,923		16,416		-		14,212		2,204
	Recourse debt		5,961		6,724		-		6,724		-
December 31, 2012
Assets
	Accounts receivable - noncurrent(1)	$	304	$	188	$	-	$	-	$	188
Liabilities
	Non-recourse debt		15,383		16,110		-		13,811		2,299
	Recourse debt		5,962		6,628		-		6,628		-

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Inventory (Tables)

3 Months Ended

Mar. 31, 2013

Inventory Tables [Abstract]

Inventory Balance By Type

	March 31,		December 31,
	2013		2012
	(in millions)
Coal, fuel oil and other raw materials	$	363	$	373
Spare parts and supplies		392		393
Total	$	755	$	766

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Long-Term Financing Receivables (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Financing Receivable Recorded Investment [Line Items]
Financing Receivable	$ 226	$ 239
Brazil [Member]
Financing Receivable Recorded Investment [Line Items]
Financing Receivable	8	8
Dominican Republic [Member]
Financing Receivable Recorded Investment [Line Items]
Financing Receivable	31	35
Argentina [Member]
Financing Receivable Recorded Investment [Line Items]
Financing Receivable	187	196
Noncurrent receivables	$ 122	$ 120

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Inventory (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Inventory Disclosure Abstract
Coal, fuel oil and other raw materials	$ 363	$ 373
Spare parts and supplies	392	393
Total	$ 755	$ 766

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Investments In Marketable Securities (Tables)

3 Months Ended

Mar. 31, 2013

Investments In Marketable Securities Tables [Abstract]

Pre-Tax Gains And Losses On Available For Sale And Trading Securities

		2013		2012
		(in millions)
Gains included in earnings that relate to trading securities
	held at the reporting date	$	1	$	-
Unrealized gains (losses) on available-for-sale securities
Losses reclassified out of other comprehensive income
Gross proceeds from sales of available-for-sale securities			1,704		1,523
Gross realized gains on sales			-		1

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Derivative Instruments and Hedging Activities (Tables)

3 Months Ended

Mar. 31, 2013

Derivative Instruments And Hedging Activities Tables [Abstract]

Interest Rate Derivatives By Type Table

	March 31, 2013
	Current			Maximum
		Derivative			Derivative		Weighted	% of Debt
		Notional			Notional		Average	Currently
	Derivative	Translated		Derivative	Translated		Remaining	Hedged
Interest Rate and Cross Currency	Notional	to USD		Notional	to USD		Term	by Index(2)
	(in millions)						(in years)
Interest Rate Derivatives:(1)
LIBOR (U.S. Dollar)	3,451	$	3,451	4,226	$	4,226	9	70%
EURIBOR (Euro)	605		776	605		776	9	67%
LIBOR (British Pound)	69		105	69		105	13	83%
Cross Currency Swaps:
Chilean Unidad de Fomento	6		271	6		271	9	85%

Foreign Currency Derivatives By Type Table

	March 31, 2013
				Weighted
		Notional		Average
		Translated		Remaining
Foreign Currency Derivatives	Notional(1)	to USD		Term(2)
	(in millions)			(in years)
Foreign Currency Options and Forwards:
Chilean Peso	80,558	$	166	<1
Brazilian Real	240		118	<1
Euro	29		41	<1
Colombian Peso	53,208		28	<1
Argentine Peso	83		14	<1
British Pound	3		5	<1
Embedded Foreign Currency Derivatives
Argentine Peso	829		169	11
Kazakhstani Tenge	1,009		7	5
Euro	2		2	10

Commodity Derivatives By Type Table

	March 31, 2013
		Weighted Average
Commodity Derivatives	Notional	Remaining Term(1)
	(in millions)	(in years)
Aluminum (MWh)(2)	14	7
Power (MWh)	6	3

Derivative Assets Liabilities At Fair Value Net By Balance Sheet Classification And Type Table

			March 31, 2013						December 31, 2012
			Designated		Not Designated		Total		Designated		Not Designated		Total
			(in millions)						(in millions)
Assets
	Interest rate derivatives		$	-	$	2	$	2	$	-	$	2		2
	Cross currency derivatives			8		-		8		6		-		6
	Foreign currency derivatives			1		87		88		-		81		81
	Commodity derivatives			-		7		7		2		9		11
		Total assets	$	9	$	96	$	105	$	8	$	92	$	100
Liabilities
	Interest rate derivatives		$	523	$	18	$	541	$	544	$	21		565
	Cross currency derivatives			3		-		3		6		-		6
	Foreign currency derivatives			7		11		18		7		7		14
	Commodity derivatives			11		82		93		8		64		72
		Total liabilities	$	544	$	111	$	655	$	565	$	92	$	657

		March 31, 2013				December 31, 2012
		Assets		Liabilities		Assets		Liabilities
		(in millions)				(in millions)
Current		$	18	$	175	$	14	$	186
Noncurrent			87		480		86		471
	Total	$	105	$	655	$	100	$	657
Derivatives subject to master netting agreement or similar agreement:
	Gross (which equals net) amounts recognized in the balance sheet	$	19	$	520	$	25	$	522
	Gross amounts of derivative instruments not offset		(8)		(8)		(9)		(9)
	Gross amounts of cash collateral received/pledged not offset		-		(14)		-		(5)
	Net amount	$	11	$	498	$	16	$	508
Other balances that had been, but no longer need to be, accounted
	for as derivatives at fair value that are to be amortized to earnings
	over the remaining term of the associated PPA	$	181	$	191	$	186	$	191

Gain Loss In Accumulated Other Comprehensive Income And Earnings On Effective Portion Of Qualifying Cash Flow Hedges Table

	Gains (Losses)				Classification in		Gains (Losses) Reclassified
	Recognized in AOCL				Condensed Consolidated		from AOCL into Earnings
Type of Derivative	2013		2012		Statements of Operations		2013		2012
	(in millions)						(in millions)
Interest rate derivatives	$	(13)	$	11	Interest expense		$	(32)	$	(32)
					Non-regulated cost of sales			(1)		(2)
					Net equity in earnings of
						affiliates		(2)		(1)
					Gain on sale of investments			-		(92)
Cross currency derivatives		1		14	Interest expense			(3)		(3)
					Foreign currency transaction
						gains (losses)		5		18
Foreign currency derivatives		1		6	Foreign currency transaction
						gains (losses)		2		-
Commodity derivatives		(5)		(6)	Non-regulated revenue			-		(2)
Total	$	(16)	$	25			$	(31)	$	(114)

Gain Loss In Earnings On Ineffective Portion Of Qualifying Cash Flow Hedges Table

	Classification in Condensed	Gains (Losses)
	Consolidated Statements	Recognized in Earnings
Type of Derivative	of Operations	2013		2012
		(in millions)
Interest rate derivatives	Interest expense	$	(1)	$	(1)
Total		$	(1)	$	(1)

Gain Loss In Earnings On Non Hedging Instruments Table

	Classification	Gains (Losses)
	in Condensed Consolidated	Recognized in Earnings
Type of Derivative	Statements of Operations	2013		2012
		(in millions)
Interest rate derivatives	Interest expense	$	1	$	(2)
	Net equity in earnings of affiliates		(6)		-
Foreign currency derivatives	Foreign currency transaction gains (losses)		6		(38)
	Net equity in earnings of affiliates		(3)		-
Commodity and other derivatives	Non-regulated revenue		(21)		14
	Regulated revenue		(3)		(4)
	Non-regulated cost of sales		1		3
	Regulated cost of sales		-		(4)
Total		$	(25)	$	(31)

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Condensed Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
OPERATING ACTIVITIES:
Net income	$ 199	$ 515
Adjustments to net income:
Depreciation and amortization	329	360
Gain from sale of investments and impairment expense	59	(92)
Deferred income taxes	13	101
Provisions for Contingencies	26	17
Loss on the extinguishment of debt	47	0
Loss on disposal and impairment write-down - discontinued operations	38	0
Other	56	(40)
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable	42	(189)
(Increase) decrease in inventory	(4)	(11)
(Increase) decrease in prepaid expenses and other current assets	(192)	(117)
(Increase) decrease in other assets	(45)	(156)
Increase (decrease) in accounts payable and other current liabilities	174	266
Increase (decrease) in income tax payables, net	(123)	(161)
Increase (decrease) in other liabilities	(1)	41
Net cash provided by operating activities	618	534
INVESTING ACTIVITIES:
Capital expenditures	(546)	(579)
Proceeds from the sale of businesses, net of cash sold	1	63
Proceeds from the sale of assets	6	4
Sale of short-term investments	1,335	1,505
Purchase of short-term investments	(1,492)	(1,855)
(Increase) decrease in restricted cash	(35)	28
(Increase) decrease in debt service reserves and other assets	(10)	20
Proceeds from government grants for asset construction	1	85
Other investing	14	4
Net cash used in investing activities	(726)	(725)
FINANCING ACTIVITIES:
Borrowings (repayments) under the revolving credit facilities, net	15	(281)
Issuance of non-recourse debt	1,491	503
Repayments of recourse debt	(2)	(3)
Repayments of non-recourse debt	(1,007)	(151)
Payments for financing fees	(33)	(12)
Distributions to noncontrolling interests	(31)	(19)
Contributions from noncontrolling interests	55	5
Dividends paid on AES common stock	(30)	0
Financed capital expenditures	(7)	(6)
Other financing	4	1
Net cash provided by financing activities	455	37
Effect of exchange rate changes on cash	(8)	25
(Increase) decrease in cash of discontinued and held for sale businesses	(4)	99
Total increase (decrease) in cash and cash equivalents	335	(30)
Cash and cash equivalents, beginning	1,966	1,688
Cash and cash equivalents, ending	2,301	1,658
SUPPLEMENTAL DISCLOSURES:
Cash payments for interest, net of amounts capitalized	234	291
Cash payments for income taxes, net of refunds	$ 295	$ 325

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Long-Term Financing Receivables (Tables)

3 Months Ended

Mar. 31, 2013

Financing Receivables Tables [Abstract]

Long-term Financing Receivables Table

	March 31,		December 31,
	2013		2012
	(in millions)
Argentina(1)	$	187	$	196
Dominican Republic		31		35
Brazil		8		8
Total long-term financing receivables	$	226	$	239

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Other Non-Operating Expense (Tables)

3 Months Ended

Mar. 31, 2013

Other Non Operating Expense Tables [Abstract]

Schedule Of Other Nonoperating Expense By Component [Table Text Block]

	Three Months Ended March 31,
	2012
	(in millions)
China generation	$	31
InnoVent		17
Other		1
Total other-non operating expense	$	49

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Derivative Instruments and Hedging Activities - Part 2 (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Assets
Derivative Assets, Gross	$ 105	$ 100
Liabilities
Derivative Liabilities, Gross	655	657
Subect to netting arrangement
Assets
Derivative Assets, Gross	19	25
Derivative Assets, Net	11	16
Derivative Assets Not Offset By Collateral	0	0
Derivative Assets Not Offset Under Netting Arrangements	(8)	(9)
Liabilities
Derivative Liabilities, Gross	520	522
Derivative Liabilities, Net	498	508
Derivative Liabilities Not Offset By Collateral	(14)	(5)
Derivative Liabilities Not Offset Under Netting Arrangements	(8)	(9)
Noncurrent
Assets
Derivative Assets, Gross	87	86
Liabilities
Derivative Liabilities, Gross	480	471
Current
Assets
Derivative Assets, Gross	18	14
Liabilities
Derivative Liabilities, Gross	175	186
Designated as Hedging Instruments
Assets
Derivative Assets, Gross	9	8
Liabilities
Derivative Liabilities, Gross	544	565
Not Designated as Hedging Instruments
Assets
Derivative Assets, Gross	96	92
Liabilities
Derivative Liabilities, Gross	111	92
No longer carried at fair value
Assets
Derivative Assets, Gross	181	186
Liabilities
Derivative Liabilities, Gross	191	191
Interest Rate Derivatives
Assets
Derivative Assets, Gross	2	2
Liabilities
Derivative Liabilities, Gross	541	565
Interest Rate Derivatives | Designated as Hedging Instruments
Assets
Derivative Assets, Gross	0	0
Liabilities
Derivative Liabilities, Gross	523	544
Interest Rate Derivatives | Not Designated as Hedging Instruments
Assets
Derivative Assets, Gross	2	2
Liabilities
Derivative Liabilities, Gross	18	21
Cross Currency Swaps
Assets
Derivative Assets, Gross	8	6
Liabilities
Derivative Liabilities, Gross	3	6
Cross Currency Swaps | Designated as Hedging Instruments
Assets
Derivative Assets, Gross	8	6
Liabilities
Derivative Liabilities, Gross	3	6
Cross Currency Swaps | Not Designated as Hedging Instruments
Assets
Derivative Assets, Gross	0	0
Liabilities
Derivative Liabilities, Gross	0	0
Foreign Currency
Assets
Derivative Assets, Gross	88	81
Liabilities
Derivative Liabilities, Gross	18	14
Foreign Currency | Designated as Hedging Instruments
Assets
Derivative Assets, Gross	1	0
Liabilities
Derivative Liabilities, Gross	7	7
Foreign Currency | Not Designated as Hedging Instruments
Assets
Derivative Assets, Gross	87	81
Liabilities
Derivative Liabilities, Gross	11	7
Commodity & Other
Assets
Derivative Assets, Gross	7	11
Liabilities
Derivative Liabilities, Gross	93	72
Commodity & Other | Designated as Hedging Instruments
Assets
Derivative Assets, Gross	0	2
Liabilities
Derivative Liabilities, Gross	11	8
Commodity & Other | Not Designated as Hedging Instruments
Assets
Derivative Assets, Gross	7	9
Liabilities
Derivative Liabilities, Gross	$ 82	$ 64

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Condensed Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
CURRENT ASSETS
Cash and cash equivalents	$ 2,301	$ 1,966
Restricted cash	760	748
Short-term investments	851	696
Accounts receivable, net of allowance for doubtful accounts of $314 and $306, respectively	2,633	2,671
Inventory	755	766
Deferred income taxes	231	222
Prepaid expenses	256	230
Other current assets	1,403	1,103
Current assets of discontinued operations and held for sale assets	68	63
Total current assets	9,258	8,465
Property, Plant and Equipment:
Land	1,019	1,007
Electric generation, distribution assets and other	32,210	31,656
Accumulated depreciation	(9,745)	(9,645)
Construction in progress	2,528	2,783
Property, plant and equipment, net	26,012	25,801
Other Assets:
Investments in and advances to affiliates	1,195	1,196
Debt service reserves and other deposits	593	565
Goodwill	1,999	1,999
Other intangible assets, net of accumulated amortization of $193 and $276, respectively	417	429
Deferred income taxes	986	996
Other noncurrent assets	2,153	2,240
Noncurrent assets of discontinued operations and held for sale assets	105	139
Total other assets	7,448	7,564
TOTAL ASSETS	42,718	41,830
CURRENT LIABILITIES
Accounts payable	2,951	2,631
Accrued interest	415	295
Accrued and other liabilities	2,251	2,505
Non-recourse debt, including $424 and $282, respectively, related to variable interest entities	3,108	2,829
Recourse debt	507	11
Current liabilities of discontinued operations and held for sale businesses	54	48
Total current liabilities	9,286	8,319
NONCURRENT LIABILITIES
Non-recourse debt, including $1,118 and $1,076, respectively, related to variable interest entities	12,815	12,554
Recourse debt	5,454	5,951
Deferred income taxes	1,239	1,237
Pension and other post-retirement liabilities	2,389	2,455
Other noncurrent liabilities	3,713	3,705
Noncurrent liabilities of discontinued operations and held for sale businesses	3	17
Total noncurrent liabilities	25,613	25,919
Contingencies and Commitments (see Note 8)
Cumulative preferred stock of subsidiaries	78	78
THE AES CORPORATION STOCKHOLDERS' EQUITY
Common stock ($0.01 par value, 1,200,000,000 shares authorized; 812,021,363 issued and 746,474,449 outstanding at March 31, 2013 and 810,679,839 issued and 744,263,855 outstanding at December 31, 2012	8	8
Additional paid-in capital	8,527	8,525
Accumulated Deficit	(182)	(264)
Accumulated other comprehensive loss	(2,952)	(2,920)
Treasury stock, at cost (65,546,914 shares at March 31, 2013 and 66,415,984 shares at December 31, 2012)	(768)	(780)
Total AES Corporation stockholders' equity	4,633	4,569
NONCONTROLLING INTERESTS	3,108	2,945
Total equity	7,741	7,514
TOTAL LIABILITIES AND EQUITY	$ 42,718	$ 41,830

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Fair Value (Recurring Measurements) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Debt securities:
Unsecured debentures	$ 615	$ 448
Certificates of deposit	137	143
Government debt securities	28	34
Subtotal	780	625
Equity securities:
Mutual funds	57	56
Subtotal	57	56
Total available-for-sale	837	681
Equity securities:
Mutual funds	12	12
Total Trading	12	12
DERIVATIVES:
Total derivatives	105	100
Total assets	954	793
Derivative Liabilities Abstract
Total Derivatives	655	657
Total liabilities	655	657
Interest Rate Derivatives
DERIVATIVES:
Total derivatives	2	2
Derivative Liabilities Abstract
Total Derivatives	541	565
Cross Currency Swaps
DERIVATIVES:
Total derivatives	8	6
Derivative Liabilities Abstract
Total Derivatives	3	6
Foreign Currency
DERIVATIVES:
Total derivatives	88	81
Derivative Liabilities Abstract
Total Derivatives	18	14
Commodity & Other
DERIVATIVES:
Total derivatives	7	11
Derivative Liabilities Abstract
Total Derivatives	93	72
Level 1
Debt securities:
Unsecured debentures	0	0
Certificates of deposit	0	0
Government debt securities	0	0
Subtotal	0	0
Equity securities:
Mutual funds	0	0
Subtotal	0	0
Total available-for-sale	0	0
Equity securities:
Mutual funds	12	12
Total Trading	12	12
DERIVATIVES:
Total derivatives	0	0
Total assets	12	12
Derivative Liabilities Abstract
Total Derivatives	0	0
Total liabilities	0	0
Level 1 | Interest Rate Derivatives
DERIVATIVES:
Total derivatives	0	0
Derivative Liabilities Abstract
Total Derivatives	0	0
Level 1 | Cross Currency Swaps
DERIVATIVES:
Total derivatives	0	0
Derivative Liabilities Abstract
Total Derivatives	0	0
Level 1 | Foreign Currency
DERIVATIVES:
Total derivatives	0	0
Derivative Liabilities Abstract
Total Derivatives	0	0
Level 1 | Commodity & Other
DERIVATIVES:
Total derivatives	0	0
Derivative Liabilities Abstract
Total Derivatives	0	0
Level 2
Debt securities:
Unsecured debentures	615	448
Certificates of deposit	137	143
Government debt securities	28	34
Subtotal	780	625
Equity securities:
Mutual funds	57	56
Subtotal	57	56
Total available-for-sale	837	681
Equity securities:
Mutual funds	0	0
Total Trading	0	0
DERIVATIVES:
Total derivatives	22	18
Total assets	859	699
Derivative Liabilities Abstract
Total Derivatives	503	179
Total liabilities	503	179
Level 2 | Interest Rate Derivatives
DERIVATIVES:
Total derivatives	2	2
Derivative Liabilities Abstract
Total Derivatives	469	153
Level 2 | Cross Currency Swaps
DERIVATIVES:
Total derivatives	8	6
Derivative Liabilities Abstract
Total Derivatives	3	6
Level 2 | Foreign Currency
DERIVATIVES:
Total derivatives	6	2
Derivative Liabilities Abstract
Total Derivatives	7	7
Level 2 | Commodity & Other
DERIVATIVES:
Total derivatives	6	8
Derivative Liabilities Abstract
Total Derivatives	24	13
Level 3
Debt securities:
Unsecured debentures	0	0
Certificates of deposit	0	0
Government debt securities	0	0
Subtotal	0	0
Equity securities:
Mutual funds	0	0
Subtotal	0	0
Total available-for-sale	0	0
Equity securities:
Mutual funds	0	0
Total Trading	0	0
DERIVATIVES:
Total derivatives	83	82
Total assets	83	82
Derivative Liabilities Abstract
Total Derivatives	152	478
Total liabilities	152	478
Level 3 | Interest Rate Derivatives
DERIVATIVES:
Total derivatives	0	0
Derivative Liabilities Abstract
Total Derivatives	72	412
Level 3 | Cross Currency Swaps
DERIVATIVES:
Total derivatives	0	0
Derivative Liabilities Abstract
Total Derivatives	0	0
Level 3 | Foreign Currency
DERIVATIVES:
Total derivatives	82	79
Derivative Liabilities Abstract
Total Derivatives	11	7
Level 3 | Commodity & Other
DERIVATIVES:
Total derivatives	1	3
Derivative Liabilities Abstract
Total Derivatives	$ 69	$ 59

XML

Condensed Consolidated Statements of Comprehensive Income (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
NET INCOME	$ 199	$ 515
Foreign currency translation activity:
Foreign currency translation adjustments, net of income tax (expense) benefit of $0 and $(1), respectively	(32)	142
Reclassification to earnings, net of income tax (expense) benefit of $0 and $0, respectively	(3)	(1)
Total foreign currency translation adjustments	(35)	141
Derivative activity:
Change in derivative fair value, net of income tax (expense) benefit of $0 and $(4), respectively	(16)	21
Reclassification to earnings, net of income tax (expense) benefit of $(7) and $(28), respectively	24	86
Total change in fair value of derivatives	8	107
Pension activity:
Reclassification to earnings due to amortization of net actuarial loss, net of income tax (expense) benefit of $(7) and (3), respectively	14	6
Total pension adjustments	14	6
OTHER COMPREHENSIVE INCOME (LOSS)	(13)	254
COMPREHENSIVE INCOME	186	769
Less: Comprehensive income attributable to noncontrolling interests	(136)	(245)
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE AES CORPORATION	$ 50	$ 524

XML

Pension Plans (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
U.S. [Member]
Defined Benefit Plan Net Periodic Benefit Cost Abstract
Service cost	$ 4	$ 4
Interest cost	11	12
Expected return on plan assets	(15)	(14)
Amortization of prior service cost	1	1
Amortization of net loss	7	6
Loss on curtailment	0	0
Total pension cost	8	9
Defined Benefit Pension Contributions Disclosure [Abstract]
Defined Benefit Plan Contributions By Employer	50
Defined Benefit Plan Estimated Future Employer Contributions Remainder Of Fiscal Year	2
Foreign [Member]
Defined Benefit Plan Net Periodic Benefit Cost Abstract
Service cost	7	7
Interest cost	139	141
Expected return on plan assets	(130)	(122)
Amortization of prior service cost	0	0
Amortization of net loss	21	10
Loss on curtailment	0	0
Total pension cost	37	36
Defined Benefit Pension Contributions Disclosure [Abstract]
Defined Benefit Plan Contributions By Employer	37
Defined Benefit Plan Estimated Future Employer Contributions Remainder Of Fiscal Year	$ 132

XML

Pension Plans (Tables)

3 Months Ended

Mar. 31, 2013

Pension Plans Tables [Abstract]

Net Periodic Benefit Cost Table

	Three Months Ended March 31,
	2013				2012
	U.S.		Foreign		U.S.		Foreign
	(in millions)
Service cost	$	4	$	7	$	4	$	7
Interest cost		11		139		12		141
Expected return on plan assets		(15)		(130)		(14)		(122)
Amortization of prior service cost		1		-		1		-
Amortization of net loss		7		21		6		10
Total pension cost	$	8	$	37	$	9	$	36

XML

Discontinued Operations And Held For Sale Businesses (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013 MWh	Mar. 31, 2012
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Generation Capacity (MW)	125
(Gain) loss on disposal and impairment write-down - discontinued operations	$ (38)	$ 0
Discontinued Operations Income Loss
Revenue	147	191
Income (loss) from operations of discontinued businesses	13	8
Income tax (expense) benefit	1	(2)
Income (loss) from operations of discontinued businesses	14	6
Net gain/(loss) on sale and impairments of discontinued operations, net of tax	(36)	(5)
Ukraine [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Sales Proceeds, Distribution	113
Discontinued operations asset impairment	$ 38
Kiev [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Divestiture Of Ownership In Subsidiary Percent	89.10%
Customers Served	881,000
Rivne [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Divestiture Of Ownership In Subsidiary Percent	84.60%
Customers Served	412,000

XML

Other Non-Operating Expense

3 Months Ended

Mar. 31, 2013

OTHER NON-OPERATING EXPENSE

14. OTHER NON-OPERATING EXPENSE

There was no other non-operating expense for the three months ended March 31, 2013. Other non-operating expense for the three months ended March 31,2012consisted ofthe other-than-temporaryimpairment of the following equity method investments:

	Three Months Ended March 31,
	2012
	(in millions)
China generation	$	31
InnoVent		17
Other		1
Total other-non operating expense	$	49

China―During the first quarter of 2012, the Company concluded it was more likely than not that it would sell its interests in certain investments in China before the end of their joint venture terms. These investments include coal-fired, hydropower and wind generation facilities accounted for under the equity method of accounting. These were considered impairment indicators. In measuring the other-than-temporary impairment, the carrying value of $164 million of these investments was compared to their fair value of $133 million resulting in an other-than-temporary impairment expense of $31 million.

InnoVent―During the first quarter of 2012, the Company concluded it was more likely than not that it would sell its interest in InnoVent S.A.S. (“InnoVent”), an equity method investment in France with wind generation projects totaling 75 MW. InnoVent had a carrying value of $36 million which exceeded its fair value of $19 million, resulting in an other-than-temporary impairment expense of $17 million.

XML

Equity (Tables)

3 Months Ended

Mar. 31, 2013

Equity Tables [Abstract]

Schedule of Stockholders Equity [Table Text Block]

			Three Months Ended March 31, 2013							Three Months Ended March 31, 2012
			The AES							The AES
			Corporation							Corporation
			Stockholders'		Noncontrolling		Total			Stockholders'		Noncontrolling		Total
			Equity		Interests		Equity			Equity		Interests		Equity
		(in millions)							(in millions)
Balance at January 1			$	4,569	$	2,945	$	7,514		$	5,946	$	3,783	$	9,729
Net income				82		117		199			341		174		515
Total foreign currency translation adjustment,
	net of income tax			(42)		7		(35)			92		49		141
Total change in derivative fair value,
	net of income tax			7		1		8			90		17		107
Total pension adjustments,
	net of income tax			3		11		14			1		5		6
Capital contributions from noncontrolling interests				-		55		55			-		6		6
Distributions to noncontrolling interests				-		(27)		(27)			-		(14)		(14)
Disposition of businesses				-		-		-			-		(37)		(37)
Issuance and exercise of stock-based compensation
	benefit plans, net of income tax			14		-		14			19		-		19
Acquisition of subsidiary shares from
	noncontrolling interests			-		(1)		(1)			-		(1)		(1)
Balance at March 31			$	4,633	$	3,108	$	7,741		$	6,489	$	3,982	$	10,471

Components Of Accumulated Other Comprehensive Income

		Unrealized derivative losses, net		Unfunded pension obligations, net		Foreign currency translation adjustment, net		Total
			(in millions)
Balance at January 1		$	(481)	$	(382)	$	(2,057)	$	(2,920)
	Other comprehensive income before reclassifications		(15)		-		(39)		(54)
	Amounts reclassified from accumulated other
	comprehensive loss		22		3		(3)		22
	Net current-period other comprehensive income		7		3		(42)		(32)
Balance at March 31		$	(474)	$	(379)	$	(2,099)	$	(2,952)

Schedule Of Amounts Reclassified Out Of Accumulated Other Comprehensive Income [Table Text Block]

Details About Accumulated Other Comprehensive Loss Components	Affected Line Item in the Condensed Consolidated Statement of Operations		Three Months Ended March 31, 2013 (1)
			(in millions)
Unrealized derivative losses, net
	Interest expense	$	(35)
	Foreign currency transaction gains (losses)		7
	Non-regulated cost of sales		(1)
	Income from continuing operations before
	taxes and equity in earnings of affiliates		(29)
	Income tax expense		7
	Net equity in earnings of affiliates		(2)
	Income from continuing operations		(24)
	Income from continuing operations attributable
	to noncontrolling interests		2
	Net income attributable to the AES Corporation	$	(22)
Amortization of defined benefit pension actuarial loss, net
	Non-regulated cost of sales	$	(1)
	Regulated cost of sales		(20)
	Income from continuing operations before
	taxes and equity in earnings of affiliates		(21)
	Income tax expense		7
	Income from continuing operations		(14)
	Income from continuing operations attributable
	to noncontrolling interests		11
	Net income attributable to the AES Corporation	$	(3)
Foreign currency translation adjustment, net
	Gain on sale of investment	$	3
	Net income attributable to the AES Corporation	$	3
Total reclassifications for the period, net of income tax and noncontrolling interests		$	(22)

XML

Dispositions

3 Months Ended

Mar. 31, 2013

ACQUISTIONS AND DISPOSITIONS

16. DISPOSITIONS

Cartagena―On February 9, 2012, a subsidiary of the Company completed the sale of 80% of its interest in the wholly-owned holding company of AES Energia Cartagena S.R.L. (“AES Cartagena”), a 1,199 MW gas-fired generation business in Spain. The Company owned approximately 70.81% of AES Cartagenathrough this holding company structure, as well as 100% of a related operations and maintenance company. During the first quarter of 2012, net proceeds from the sale of the 80% interest were approximately $229 million and the Company recognized a pretax gain of $178 million. Under the terms of the sale agreement, the buyer had an option to purchase the Company's remaining 20% interest at a fixed price of $36 million during a five month period beginning March 2013. Of the total proceeds received in February 2012, approximately $9 million was deferred and allocated to the buyer's option to purchase the Company's remaining interest. The buyer exercised the option topurchase the Company's remaining 20% interest in AES Cartagena on April 26, 2013. Net proceeds from the exercise of the option were approximately $24 million and the Company will recognize a pretax gain of $20 millionin the second quarter of 2013.

Due to the Company's continuing ownership interest extending beyond one year from the completion of the sale of its 80% interest, the prior period operating results of AES Cartagena were not reclassified as discontinued operations.

XML

Subsequent Events (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013
Cartagena [Member]
Subsequent Event [Line Items]
Subsequent Event, Description	Cartagena―On April 26, 2013, the Company’s remaining 20% interest held in AES Cartagena was sold upon the exercise of the purchase option by the buyer. See Note 16―Dispositions for further information.
Ukraine Utilities [Member]
Subsequent Event [Line Items]
Subsequent Event, Description	Ukraine Utilities Sale―The sale transaction of Ukraine utilities was closed on April 29, 2013. See Note 15—Discontinued Operations and Held for Sale Businesses for further information.
Dividend Declared [Member]
Subsequent Event [Line Items]
Subsequent Event, Description	Dividend―On April 18, 2013, the Company’s Board of Directors declared a dividend of $0.04 per outstanding share payable on May 15, 2013 to the shareholders of record at the close of business on May 1, 2013.
Issuance of Debt [Member]
Subsequent Event [Line Items]
Non-recourse Debt Issued	500
Subsequent Event, Description	Recourse Debt―On April 30, 2013, the Company issued $500 million aggregate principal amount of 4.875% senior notes due 2023 (the “Notes”). In connection with this offering, the Company has commenced the tender offers (the “Tender Offers”) to purchase for cash up to $800 million aggregate principal amount of four series of our outstanding senior notes, including any and all of our outstanding 7.75% senior notes due 2014 (the “2014 Notes”), of which $500 million are currently outstanding; up to $100 million of our outstanding 7.75% senior notes due 2015 (the “2015 Notes”), of which $500 million are currently outstanding; up to $100 million of our outstanding 9.75% senior notes due 2016 (the “2016 Notes”), of which $535 million are currently outstanding; and up to $100 million of our outstanding 8.00% senior notes due 2017 (the “2017 Notes” and, together with the 2014 Notes, the 2015 Notes and the 2016 Notes, the “Outstanding Notes”), of which $1,500 million are currently outstanding. We intend to use the net proceeds from this offering, as well as, if necessary, other available funds, to fund the Tender Offers and to pay certain related fees and expenses. If any net proceeds from this offering remain after completion of the Tender Offers, we intend to use such proceeds for general corporate purposes.

XML

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Change in fair value of available-for-sale securities, income tax	$ 0	$ 0
Available-for-sale securities, reclassification to earnings, income tax	0	0
Foreign currency translation adjustments, income tax	0	1
Foreign currency, reclassification to earnings, income tax	0	0
Change in derivative fair value, income tax	0	4
Derivative reclassification to earnings, income tax	(7)	(28)
Pension, amortization of net actuarial loss, income tax	$ (7)	$ (3)

XML

Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Accounts receivable, allowance for doubtful accounts	$ 314	$ 306
Other intangible assets, accumulated amortization	193	276
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	1,200,000,000	1,200,000,000
Common stock, shares issued	812,021,363	810,679,839
Common stock, shares outstanding	746,474,449	744,263,855
Treasury stock, shares	65,546,914	66,415,984
Variable Interest Entity [Line Items]
Non-recourse debt - current, balance at variable interest entities	3,108	2,829
Non-recourse debt - noncurrent, balance at variable interest entities	12,815	12,554
Consolidated Variable Interest Entities [Member]
Variable Interest Entity [Line Items]
Non-recourse debt - current, balance at variable interest entities	424	282
Non-recourse debt - noncurrent, balance at variable interest entities	$ 1,118	$ 1,076

XML

Pension Plans

3 Months Ended

Mar. 31, 2013

PENSION PLANS

9. PENSION PLANS

Total pension cost for the three months ended March 31, 2013 and 2012 included the following components:

	Three Months Ended March 31,
	2013				2012
	U.S.		Foreign		U.S.		Foreign
	(in millions)
Service cost	$	4	$	7	$	4	$	7
Interest cost		11		139		12		141
Expected return on plan assets		(15)		(130)		(14)		(122)
Amortization of prior service cost		1		-		1		-
Amortization of net loss		7		21		6		10
Total pension cost	$	8	$	37	$	9	$	36

Total employer contributions for the threemonths ended March 31, 2013 for the Company's U.S. and foreign subsidiaries were $50million and $37 million, respectively. The expected remaining scheduled employer contributions for 2013 are $2 million and $132 million for U.S. and foreign subsidiaries, respectively.

XML

Document And Entity Information	3 Months Ended
	Mar. 31, 2013	May 03, 2013
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Trading Symbol	AES
Entity Registrant Name	AES CORP
Entity Central Index Key	0000874761
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		746,540,903
Entity current reporting status	Yes
Entity voluntary filers	No
Entity Well Known Seasoned Issuer	Yes

XML

Equity

3 Months Ended

Mar. 31, 2013

EQUITY

10. EQUITY

Changes in Equity

The following table provides a reconciliation of the beginning and ending equity attributable to stockholders of The AES Corporation, noncontrolling interests and total equity as of March 31, 2013 and 2012:

			Three Months Ended March 31, 2013							Three Months Ended March 31, 2012
			The AES							The AES
			Corporation							Corporation
			Stockholders'		Noncontrolling		Total			Stockholders'		Noncontrolling		Total
			Equity		Interests		Equity			Equity		Interests		Equity
		(in millions)							(in millions)
Balance at January 1			$	4,569	$	2,945	$	7,514		$	5,946	$	3,783	$	9,729
Net income				82		117		199			341		174		515
Total foreign currency translation adjustment,
	net of income tax			(42)		7		(35)			92		49		141
Total change in derivative fair value,
	net of income tax			7		1		8			90		17		107
Total pension adjustments,
	net of income tax			3		11		14			1		5		6
Capital contributions from noncontrolling interests				-		55		55			-		6		6
Distributions to noncontrolling interests				-		(27)		(27)			-		(14)		(14)
Disposition of businesses				-		-		-			-		(37)		(37)
Issuance and exercise of stock-based compensation
	benefit plans, net of income tax			14		-		14			19		-		19
Acquisition of subsidiary shares from
	noncontrolling interests			-		(1)		(1)			-		(1)		(1)
Balance at March 31			$	4,633	$	3,108	$	7,741		$	6,489	$	3,982	$	10,471

Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss by component, net of tax and noncontrolling interestsfor the three months ended March 31, 2013 were as follows:

		Unrealized derivative losses, net		Unfunded pension obligations, net		Foreign currency translation adjustment, net		Total
			(in millions)
Balance at January 1		$	(481)	$	(382)	$	(2,057)	$	(2,920)
	Other comprehensive income before reclassifications		(15)		-		(39)		(54)
	Amounts reclassified from accumulated other
	comprehensive loss		22		3		(3)		22
	Net current-period other comprehensive income		7		3		(42)		(32)
Balance at March 31		$	(474)	$	(379)	$	(2,099)	$	(2,952)

Details About Accumulated Other Comprehensive Loss Components	Affected Line Item in the Condensed Consolidated Statement of Operations		Three Months Ended March 31, 2013 (1)
			(in millions)
Unrealized derivative losses, net
	Interest expense	$	(35)
	Foreign currency transaction gains (losses)		7
	Non-regulated cost of sales		(1)
	Income from continuing operations before
	taxes and equity in earnings of affiliates		(29)
	Income tax expense		7
	Net equity in earnings of affiliates		(2)
	Income from continuing operations		(24)
	Income from continuing operations attributable
	to noncontrolling interests		2
	Net income attributable to the AES Corporation	$	(22)
Amortization of defined benefit pension actuarial loss, net
	Non-regulated cost of sales	$	(1)
	Regulated cost of sales		(20)
	Income from continuing operations before
	taxes and equity in earnings of affiliates		(21)
	Income tax expense		7
	Income from continuing operations		(14)
	Income from continuing operations attributable
	to noncontrolling interests		11
	Net income attributable to the AES Corporation	$	(3)
Foreign currency translation adjustment, net
	Gain on sale of investment	$	3
	Net income attributable to the AES Corporation	$	3
Total reclassifications for the period, net of income tax and noncontrolling interests		$	(22)

_______________________

(1)Amounts in parentheses indicate debits to the condensed consolidated statement of operations.

Dividend

The Company paid a dividend of $0.04 per outstanding share to its common stockholders on February 15, 2013.

Stock Repurchase Program

The Company'sBoard of Directors has approved a stock repurchase program (the “Program”). The Program does not have an expiration date and it can be modified or terminated by the Company's Board at any time. Under the Program, the Company may repurchase stock through a variety of methods, including open market repurchases and/or privately negotiated transactions. There can be no assurances as to the amount, timing or prices of repurchases, which may vary based on market conditions and other factors. As of March 31, 2013, $300 million was available under the Program.

There were no common stock repurchases under theProgram during the three months ended March 31, 2013. The cumulative total purchases under the Program totaled 58,715,189 shares at a total cost of $680 million, which includes a nominal amount of commissions (average of $11.58 per share including commissions).

The common stock repurchased has been classified as treasury stock and accounted for using the cost method. A total of 65,546,914 and 66,415,984 shares were held as treasury stock at March 31, 2013 and December 31, 2012, respectively. Restricted stock units under the Company's employee benefit plans are issued from treasury stock.The Company has not retired any common stock repurchased since it began the Program.

XML

Condensed Consolidated Statements Of Operations (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Revenue:
Regulated	$ 2,246	$ 2,484
Non-Regulated	2,019	2,102
Total Revenue	4,265	4,586
Cost of Sales:
Regulated	(1,894)	(2,056)
Non-Regulated	(1,616)	(1,458)
Total cost of sales	(3,510)	(3,514)
Gross Margin	755	1,072
General and administrative expenses	(61)	(87)
Interest expense	(377)	(416)
Interest income	66	91
Other expense	(75)	(28)
Other income	68	18
Gain on sale of investments	3	179
Asset impairment expense	(48)	(10)
Foreign currency transaction losses	(32)	(1)
Other non-operating expense	0	(49)
INCOME FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN EARNINGS OF AFFILIATES	299	769
Income tax expense	(82)	(268)
Net equity in earnings of affiliates	4	13
INCOME FROM CONTINUING OPERATIONS	221	514
Income from operations of discontinued businesses, net of income tax (benefit) expense of $(1), $2, respectively	14	6
Net loss from disposal and impairments of discontinued businesses, net of income tax expense (benefit) of $(1), $0, respectively	(36)	(5)
NET INCOME	199	515
Noncontrolling interests:
Less: Income from continuing operations attributable to noncontrolling interests	(115)	(173)
Less: Income from discontinued operations attributable to noncontrolling interests	(2)	(1)
Total net income attributable to noncontrolling interests	(117)	(174)
NET INCOME ATTRIBUTABLE TO THE AES CORPORATION	82	341
AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:
Income from continuing operations, net of tax	106	341
Loss from discontinued operations, net of tax	(24)	0
Net income	$ 82	$ 341
BASIC EARNINGS PER SHARE:
Income from continuing operations attributable to The AES Corporation common stockholders, net of tax	$ 0.14	$ 0.45
Loss from discontinued operations attributable to The AES Corporation common stockholders, net of tax	$ (0.03)	$ 0
NET INCOME ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS	$ 0.11	$ 0.45
DILUTED EARNINGS PER SHARE:
Income from continuing operations attributable to The AES Corporation common stockholders, net of tax	$ 0.14	$ 0.44
Loss from discontinued operations attributable to The AES Corporation common stockholders, net of tax	$ (0.03)	$ 0
NET INCOME ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS	$ 0.11	$ 0.44

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Investments In Marketable Securities

3 Months Ended

Mar. 31, 2013

INVESTMENTS IN MARKETABLE SECURITIES

4. INVESTMENTS IN MARKETABLE SECURITIES

The Company's investments in marketable debt and equity securities as of March 31, 2013 and December 31, 2012 by security class and by level within the fair value hierarchy have been disclosed in Note 3—Fair Value. The security classes are determined based on the nature and risk of a security and are consistent with how the Company manages, monitors and measures its marketable securities. As of March 31, 2013, all available-for-sale debt securities had stated maturities within one year.

The following table summarizes the pre-tax gains and losses related to available-for-sale and trading securities for thethree months ended March 31, 2013 and 2012. Gains and losses on the sale of investments are determined using the specific identification method.For thethree months ended March 31, 2013 and 2012, there were no realizedlosses on the sale of available-for-sale securities and no other-than-temporary impairment of marketable securities recognized in earnings or other comprehensive income.

		2013		2012
		(in millions)
Gains included in earnings that relate to trading securities
	held at the reporting date	$	1	$	-
Unrealized gains (losses) on available-for-sale securities
Losses reclassified out of other comprehensive income
Gross proceeds from sales of available-for-sale securities			1,704		1,523
Gross realized gains on sales			-		1

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Fair Value

3 Months Ended

Mar. 31, 2013

FAIR VALUE

3. FAIR VALUE

The fair value of current financial assets and liabilities, debt service reserves and other deposits approximate their reported carrying amounts. The estimated fair values of the Company's assets and liabilities have been determined using available market information. By virtue of these amounts being estimates and based on hypothetical transactions to sell assets or transfer liabilities, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. There were no changes in fair valuation techniques during the period and the Company continues to follow the valuation techniques described in Note 4.—FairValuein Item 8.—Financial Statements and Supplementary Dataofits 2012 Form 10-K.

Recurring Measurements

The following table sets forth, by level within the fair value hierarchy, the Company's financial assets and liabilities that were measured at fair value on a recurring basis as of March 31, 2013 and December 31, 2012:

			March 31, 2013								December 31, 2012
			Level 1		Level 2		Level 3			Total	Level 1		Level 2		Level 3			Total
Assets			(in millions)
AVAILABLE-FOR-SALE:(1)
	Debt securities:
		Unsecured debentures	$	-	$	615	$	-	$	615	$	-	$	448	$	-	$	448
		Certificates of deposit		-		137		-		137		-		143		-		143
		Government debt securities		-		28		-		28		-		34		-		34
		Subtotal		-		780		-		780		-		625		-		625
	Equity securities:
		Mutual funds		-		57		-		57		-		56		-		56
		Subtotal		-		57		-		57		-		56		-		56
	Total available-for-sale			-		837		-		837		-		681		-		681
TRADING:
	Equity securities:
		Mutual funds		12		-		-		12		12		-		-		12
	Total trading			12		-		-		12		12		-		-		12
DERIVATIVES:
	Interest rate derivatives			-		2		-		2		-	$	2	$	-		2
	Cross currency derivatives			-		8		-		8		-		6		-		6
	Foreign currency derivatives			-		6		82		88		-		2		79		81
	Commodity derivatives			-		6		1		7		-		8		3		11
		Total derivatives		-		22		83		105		-		18		82		100
TOTAL ASSETS			$	12	$	859	$	83	$	954	$	12	$	699	$	82	$	793
Liabilities
DERIVATIVES:
	Interest rate derivatives		$	-	$	469	$	72	$	541	$	-	$	153	$	412	$	565
	Cross currency derivatives			-		3		-		3		-		6		-		6
	Foreign currency derivatives			-		7		11		18		-		7		7		14
	Commodity derivatives			-		24		69		93		-		13		59		72
		Total derivatives		-		503		152		655		-		179		478		657
TOTAL LIABILITIES			$	-	$	503	$	152	$	655	$	-	$	179	$	478	$	657

_______________________

• Amortized cost approximated fair value at March 31, 2013 and December 31, 2012. As of March 31, 2013, all available-for-sale debt securities had stated maturities within one year.

The following tables present a reconciliation of net derivative assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for thethreemonths ended March 31, 2013 and 2012 (presented net by type of derivative where any foreign currency impacts are presented as part of gains (losses) in earnings or other comprehensive income as appropriate)

						Three Months Ended March 31, 2013
						Interest		Foreign
						Rate		Currency		Commodity		Total
			(in millions)
Balance at January 1						$	(412)	$	73	$	(57)	$	(396)
	Total gains (losses) (realized and unrealized):
		Included in earnings					-		(1)		(10)		(11)
		Included in other comprehensive income					(17)		-		-		(17)
		Included in regulatory (assets) liabilities					-		-		(1)		(1)
	Settlements						23		(1)		-		22
	Transfers of (assets) liabilities out of Level 3						334		-		-		334
Balance at March 31						$	(72)	$	71	$	(68)	$	(69)
Total gains (losses) for the period included in earnings
	attributable to the change in unrealized gains (losses)
	relating to assets and liabilities held at the end of the
	period					$	-	$	(2)	$	(10)	$	(12)
				Three Months Ended March 31, 2012
				Interest		Cross		Foreign
				Rate		Currency		Currency		Commodity		Total
			(in millions)
Balance at January 1				$	(128)	$	(18)	$	51	$	(53)	$	(148)
	Total gains (losses) (realized and unrealized):
		Included in earnings			(1)		-		(2)		8		5
		Included in other comprehensive income			1		14		-		-		15
		Included in regulatory (assets) liabilities			-		-		-		-		-
	Settlements				6		4		(1)		(1)		8
	Transfers of assets (liabilities) into Level 3				(28)		-		-		-		(28)
	Transfers of (assets) liabilities out of Level 3				26		-		-		-		26
Balance at March 31				$	(124)	$	-	$	48	$	(46)	$	(122)
Total gains (losses) for the period included in earnings
	attributable to the change in unrealized gains (losses)
	relating to assets and liabilities held at the end of the
	period			$	-	$	-	$	(3)	$	9	$	6

						Amount or Range
Type of Derivative			Fair Value	Unobservable Input		(Weighted Average)
		(in millions)
Interest rate		$	(72)	Subsidiaries' credit spreads		2.15% - 9.03% (4.35%)
Foreign currency:
	Embedded derivative - Argentine Peso		70	Argentine Peso to U.S. Dollar
					currency exchange rate after 3 years	14.4 - 21.2 (17.7)
Commodity:
	Embedded derivative - Aluminum		(65)	Market price of power for
					customer in Cameroon (per KWh)	$0.06 - $0.14 ($0.12)
Other			(2)
Total		$	(69)

Nonrecurring Measurements

For purposes of impairment evaluation, the Company measured the fair value of long-lived assets and equity method investments under the fair value measurement accounting guidance. Impairment expense is measured by comparing the fair value of asset groups at the evaluation date totheir carrying amount. The following table summarizes major categories of assets and liabilities measured at fair value on a nonrecurring basis during the period and their level within the fair value hierarchy:

			Three Months Ended March 31, 2013
			Carrying		Fair Value						Gross
			Amount		Level 1		Level 2		Level 3		Loss
Assets			(in millions)
	Long-lived assets held and used:(1)
		Beaver Valley	$	61	$	-	$	-	$	15	$	46
	Long-lived assets held for sale:(1)
		Wind turbines		25		-		-		25		-
	Discontinued operations and held for sale businesses:(2)
		Ukraine utilities		143		-		109		-		38
	Goodwill
			Three Months Ended March 31, 2012
			Carrying		Fair Value						Gross
			Amount		Level 1		Level 2		Level 3		Loss
Assets			(in millions)
	Long-lived assets held and used:(1)
		Kelanitissa		22		-		-		17		5
	Equity method investments(3)			204		-		155		-		49

_______________________

(1) See Note 13―Asset Impairment Expensefor further information.

(2) See Note 15―Discontinued Operations and Held For Sale Businessesfor further information. Also, the gross loss equals the carrying amount of the disposal group less its fair value less costs to sell.

(3) See Note 14―Other Non-Operating Expense for further information.

The following table summarizes the significant unobservable inputs used in the Level 3 measurement of long-lived assets during the three months ended March 31, 2013:

		Fair Value		Valuation Technique	Unobservable Input		Range (Weighted Average)
		(in millions)					($ in millions)
Long-lived assets held and used:
	Beaver Valley	$	15	Discounted
				cash flow	Annual revenue growth		3% to 45% (19%)
					Annual pretax operating margin		-42% to 41% (25%)
					Weighted average cost of capital		7%
Long-lived assets held for sale:
	Wind turbines		25	Market
				Approach	Indicative offer prices	$	$12 to $38 (25)
Total		$	40

Financial Instrumentsnot Measured at Fair Value in the Condensed Consolidated Balance Sheets

The following table sets forth the carrying amount and fair value of the Company's financial assets and liabilities that are not measured at fair value in the condensed consolidated balance sheets as of March 31, 2013and December 31, 2012, but for which fair value is disclosed. In addition, the fair value level hierarchy of such assets and liabilities is presented as of March 31, 2013:

		Carrying		Fair Value
March 31, 2013		Amount			Total	Level 1		Level 2		Level 3
		(in millions)
Assets
	Accounts receivable - noncurrent(1)	$	295	$	167	$	-	$	-	$	167
Liabilities
	Non-recourse debt		15,923		16,416		-		14,212		2,204
	Recourse debt		5,961		6,724		-		6,724		-
December 31, 2012
Assets
	Accounts receivable - noncurrent(1)	$	304	$	188	$	-	$	-	$	188
Liabilities
	Non-recourse debt		15,383		16,110		-		13,811		2,299
	Recourse debt		5,962		6,628		-		6,628		-

(1) These accounts receivable principally relate to amounts due from the independent system operator in Argentina and are included in “Noncurrent assets― Other” in the accompanying condensed consolidated balance sheets. The fair value of these accounts receivable excludesvalue added tax of $53 million and $55 million at March 31, 2013 and December 31, 2012,respectively.

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Discontinued Operations and Held For Sale Businesses

3 Months Ended

Mar. 31, 2013

DISCONTINUED OPERATIONS AND HELD FOR SALE BUSINESSES

15. DISCONTINUED OPERATIONS AND HELD FOR SALE BUSINESSES

In addition to the businesses reported as discontinued operations in the 2012 Form 10-K, discontinued operations include the results of the following businesses classified as held for sale in March of 2013:

• Ukraine Utilities businesses

The following table summarizes the revenue, income from operations,income tax expense,impairmentand loss on disposalof all discontinued operationsfor thethree months ended March 31, 2013 and 2012:

		Three Months
		Ended March 31,
		2013		2012
		(in millions)
Revenue		$	147	$	191
Income from operations of discontinued businesses, before income tax		$	13	$	8
Income tax benefit (expense)			1		(2)
Income from operations of discontinued
	businesses, after income tax	$	14	$	6
Net loss from disposal and impairments of discontinued
	businesses, after income tax	$	(36)	$	(5)

Ukraine Utilities sale—On January 29, 2013, the Company agreed to sell its two power distribution businesses in Ukraine to VS Energy International. Under the agreement, the Company sold its 89.1% equity interest in AESKyivoblenergo, which serves 881,000 customers in the Kiev region, and its 84.6% percent equity interest in AES Rivneoblenergo, which serves 412,000 customers in the Rivne region. The Company recognized an asset impairment of $38 million upon fair value measurement during the three months ended March 31, 2013. The transaction closedon April 29, 2013 and net proceeds of $109 million were received. These businesses were previously reported in “Corporate and Other”.

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Segments

3 Months Ended

Mar. 31, 2013

SEGMENTS

11. SEGMENTS

The segment reporting structure uses the Company's management reporting structure as its foundation to reflect how the Company manages the business internally with further aggregation by geographic regions to provide better socio-political-economic understanding of our business. The management reporting structure is organized along six strategic business units (“SBUs”) – led by our Chief Operating Officer (“COO”), who in turn reports to our Chief Executive Officer (“CEO”). Upon the application of the accounting guidance for segment reporting, the Company has identified eight reportable segments based on the six strategic business units:

• US – Generation;
• US – Utilities;
• Andes – Generation;
• Brazil – Generation;
• Brazil – Utilities;
• MCAC – Generation;
• EMEA – Generation; and
• Asia – Generation.

Corporate and Other—The Company's EMEA and MCAC Utilities operating segments are reported within “Corporate and Other” because they do not meet the criteria to allow for aggregation with another operating segment or the quantitative thresholds that would require separate disclosure under the segment reporting accounting guidance. None of these operating segments are currently material to our presentation of reportable segments, individually or in the aggregate. AES Solar and certain other unconsolidated businesses are accounted for using the equity method of accounting; therefore, their operating results are included in “Net Equity in Earnings of Affiliates” on the face of the Consolidated Statements of Operations, not in revenue or Adjusted pre-tax contribution (“Adjusted PTC”). “Corporate and Other” also includes corporate overhead costs which are not directly associated with the operations of our eight reportable segments and other intercompany charges such as self-insurance premiums which are fully eliminated in consolidation.

The Company uses Adjusted PTC as its primary segment performance measure.  Adjusted PTC, a non-GAAP measure, is defined by the Company as pre-tax income from continuing operations attributable to AES excluding unrealized gains or losses related to derivative transactions, unrealized foreign currency gains or losses, gains or losses due to dispositions and acquisitions of business interests, losses due to impairments and costs due to the early retirement of debt. The Company has concluded that Adjusted PTC best reflects the underlying business performance of the Company and is the most relevant measure considered in the Company's internal evaluation of the financial performance of its segments.  Additionally, given its large number of businesses and complexity, the Company concluded that Adjusted PTC is a more transparent measure that better assists the investor in determining which businesses have the greatest impact on the overall Company results.  

Total revenue includes inter-segment revenue related to the transfer of electricity from generation plants to utilities within Brazil. No material inter-segment revenue relationships exist between other segments. Corporate allocations include certain self-insurance activities which are reflected within segment adjusted PTC. All intra-segment activity has been eliminated with respect to revenue and adjusted PTC within the segment. Inter-segment activity has been eliminated within the total consolidated results. Asset information for businesses that were discontinued or classified as held for sale as of March 31, 2013 is segregated and is shown in the line “Discontinued Businesses” in the accompanying segment tables.

Information about the Company's operations by segment for the three months ended March 31, 2013 and 2012 was as follows:

Revenue
Three Months Ended	Total Revenue				Intersegment				External Revenue
March 31,	2013		2012		2013		2012		2013		2012
	(in millions)
US - Generation	$	170	$	198	$	-	$	-	$	170	$	198
US - Utilities		722		732		-		-		722		732
Andes - Generation		691		734		-		(9)		691		725
Brazil - Generation		386		305		(280)		(282)		106		23
Brazil - Utilities		1,323		1,531		-		-		1,323		1,531
MCAC - Generation		458		393		(1)		(1)		457		392
EMEA - Generation		351		477		(8)		(9)		343		468
Asia - Generation		134		182		-		-		134		182
Corporate and Other		320		336		(1)		(1)		319		335
Total Revenue	$	4,555	$	4,888	$	(290)	$	(302)	$	4,265	$	4,586

Adjusted Pre-Tax Contribution(1)	Total Adjusted								External Adjusted
Three Months Ended	Pre-tax Contribution				Intersegment				Pre-tax Contribution
March 31,	2013		2012		2013		2012		2013		2012
	(in millions)
US - Generation	$	65	$	36	$	2	$	11	$	67	$	47
US - Utilities		70		57		-		-		70		57
Andes - Generation		80		111		3		(5)		83		106
Brazil - Generation		40		52		(67)		(68)		(27)		(16)
Brazil - Utilities		2		56		45		46		47		102
MCAC - Generation		48		71		3		2		51		73
EMEA - Generation		94		187		(2)		(14)		92		173
Asia - Generation		31		32		1		-		32		32
Corporate and Other		(165)		(189)		15		28		(150)		(161)
Total		265		413		-		-		265		413
Reconciliation to Income from Continuing Operations before Taxes and Equity earnings of Affiliates:
Non-GAAP Adjustments:
Unrealized derivative losses										(13)		(30)
Unrealized foreign currency gains (losses)										(27)		29
Disposition/acquisition gains										3		178
Impairment losses										(48)		(58)
Debt retirement losses										(43)		-
Pre-tax contribution										137		532
Add: income from continuing operations before taxes, attributable to noncontrolling interests										166		250
Less: Net equity in earnings of affiliates										4		13
Income from continuing operations before taxes and equity in earnings of affiliates									$	299	$	769

_____________________________

• Adjusted pre-tax contribution in each segment before intersegment eliminations includes the effect of intercompany transactions with other segments except for interest and charges for certain management fees.

Assets by segment as of March 31, 2013 and December 31, 2012 were as follows:

	Total Assets
	March 31, 2013		December 31, 2012
	(in millions)
Assets
US - Generation	$	3,184	$	3,259
US - Utilities		7,576		7,534
Andes - Generation		6,554		6,619
Brazil - Generation		1,867		1,590
Brazil - Utilities		8,424		8,120
MCAC - Generation		4,440		4,293
EMEA - Generation		4,568		4,578
Asia - Generation		2,702		2,625
Discontinued businesses		173		202
Corporate and Other & eliminations		3,230		3,010
Total assets	$	42,718	$	41,830

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Non-Recourse Debt

3 Months Ended

Mar. 31, 2013

DEBT

7. NON-RECOURSE DEBT

Significant transactions

During the three months ended March 31, 2013, we had the following significant debt transactions at our subsidiaries:

• Tietê issued new debt of $251 million partially offset by repayments of $60 million;
• El Salvador issued new debt of $310 million partially offset by repayments of $150 million;
• Sul issued new debt of $150 million partially offset by repayments of $34 million;
• Mong Duong drew $119 million under its construction loan facility; and
• Masinloc refinanced its senior debt facility of $500 million and incurred a loss on extinguishment of debt of $43 million. See Note 12―Other Income and Expense for further information.

Debt in default

The following table summarizes the Company's subsidiary non-recourse debt in default or accelerated as of March 31, 2013 and is classified as current non-recourse debt unless otherwise indicated:

	Primary Nature	March 31, 2013
Subsidiary	of Default	Default Amount		Net Assets
		(in millions)
Maritza	Covenant	$	819	$	576
Sonel	Covenant		264		361
Kavarna	Covenant		196		82
Changuinola	Covenant		395		249
Saurashtra	Covenant		25		15
Total		$	1,304

Theabove defaults are not payment defaults, but are instead technical defaults triggered by failure to comply with other covenants and/or other conditions such as (but not limited to) failure to meet information covenants, complete construction or other milestones in an allocated time, meet certain minimum or maximum financial ratios, or other requirements contained in the non-recourse debt documents of the Company.

In addition, in the event that there is a default, bankruptcy or maturity acceleration at a subsidiary or group of subsidiaries that meets the applicable definition of materiality under the corporate debt agreements of The AES Corporation, there could be a cross-default to the Company's recourse debt. At March 31, 2013 none of the defaults listed above individually or in the aggregate results in a cross-default under the recourse debt of the Company.

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Equity (Details) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended		33 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Mar. 31, 2013	Dec. 31, 2012
Changes In Equity Disclosure [Line Items]
Beginning Balance	$ 7,514	$ 9,729
Net income	199	515
Total foreign currency translation adjustment, net of income tax	(35)	141
Total pension adjustments, net of income tax	14	6
Total change in fair value of derivatives, net of income tax	8	107
Capital contributions from noncontrolling interests	55	6
Distributions to noncontrolling interests	(27)	(14)
Disposition of businesses	0	(37)
Issuance and exercise of stock-based compensation benefit plans, net of income tax	14	19
Acquisition of subsidiary shares from noncontrolling interests	(1)	(1)
Sale of subsidiary shares to noncontrolling interest	0	0
Ending Balance	7,741	10,471	7,741
Unrealized Derivative Losses [Abstract]
Unrealized derivative losses, beginning balance	(481)
Other comprehensive income before reclassifications	(15)
Amount reclassified from accumulated other comprehensive loss	22
Net currrent-period other comprehensive income	7
Unrealized Derivative Losses, ending balance	(474)		(474)
Unfunded Pension Obligations [Abstract]
Unfunded pension obligation, beginning balance	(382)
Amount reclassified from accumulated other comprehensive loss	3
Net current-period other comprehensive income	3
Unfunded pension obligation, ending balance	(379)		(379)
Foreign Currency Translation Adjustment [Abstract]
Foreign currency translation adjustment, beginning balance	(2,057)
Other comprehensive income before reclassifications	(39)
Amounts reclassified from accumulated other comprehensive loss	(3)
Net current-period other comprehensive income	(42)
Foreign currency translation adjustment, ending balance	(2,099)		(2,099)
Accumulated other comprehensive loss, beginning balance	(2,920)
Other comprehensive income before reclassifications	(54)
Amounts reclassified from accumulated other comprehensive loss	22
Net current-period other comprehensive income	(32)
Accumulated other comprehensive loss, ending balance	(2,952)		(2,952)
Reclassifications Out Of Accumulated Other Comprehensive Income [Line Items]
Interest expense	(377)	(416)
Foreign currency transaction gains (losses)	(32)	(1)
Non-regulated cost of sales	1,616	1,458
Regulated cost of sales	1,894	2,056
Total cost of sales	3,510	3,514
Gross margin	755	1,072
Gain on sale of investments	3	179
Income from continuing operations before taxes and equity in earnings of affiliates	299	769
Income tax expense	(82)	(268)
Net equity in earnings of affiliates	4	13
Income From Continuing Operations	221	514
Income from continuing operations attributable to noncontrolling interests	115	173
Net Income Loss Attributable To The AES Corporation	82	341
Dividend
Per-share Payments of Ordinary Dividends, Common Stock	$ 0.04
Stock Repurchase Plan [Abstract]
Total repurchase amount authorized	680
Acquisition of treasury stock (shares)	0		58,715,189
Treasury Stock Value Acquired Cost Method Excluding Commissions			680
Treasury Stock Acquired Average Cost Per Share			$ 11.58
Stock Repurchase Program, Remaining Authorized Repurchase Amount	300
Treasury stock, shares	65,546,914		65,546,914	66,415,984
Reclassified Out of AOCI [Member]
Reclassifications Out Of Accumulated Other Comprehensive Income [Line Items]
Net Income Loss Attributable To The AES Corporation	(22)
Unrealized Derivative Losses, Net [Member] | Reclassified Out of AOCI [Member]
Reclassifications Out Of Accumulated Other Comprehensive Income [Line Items]
Interest expense	(35)
Foreign currency transaction gains (losses)	7
Non-regulated cost of sales	(1)
Gross margin	(1)
Income from continuing operations before taxes and equity in earnings of affiliates	(29)
Income tax expense	7
Net equity in earnings of affiliates	(2)
Income From Continuing Operations	(24)
Income from continuing operations attributable to noncontrolling interests	2
Net Income Loss Attributable To The AES Corporation	(22)
Amortization Of Defined Benefit Pension Actuarial Loss, Net [Member] | Reclassified Out of AOCI [Member]
Reclassifications Out Of Accumulated Other Comprehensive Income [Line Items]
Non-regulated cost of sales	(1)
Regulated cost of sales	(20)
Income from continuing operations before taxes and equity in earnings of affiliates	(21)
Income tax expense	7
Income From Continuing Operations	(14)
Income from continuing operations attributable to noncontrolling interests	11
Net Income Loss Attributable To The AES Corporation	(3)
Foreign Currency Translation Adjustment, Net [Member] | Reclassified Out of AOCI [Member]
Reclassifications Out Of Accumulated Other Comprehensive Income [Line Items]
Gain on sale of investments	3
Net Income Loss Attributable To The AES Corporation	3
The AES Corporation Stockholders' Equity
Changes In Equity Disclosure [Line Items]
Beginning Balance	4,569	5,946
Net income	82	341
Total foreign currency translation adjustment, net of income tax	(42)	92
Total pension adjustments, net of income tax	3	1
Total change in fair value of derivatives, net of income tax	7	90
Capital contributions from noncontrolling interests	0	0
Distributions to noncontrolling interests	0	0
Disposition of businesses	0	0
Issuance and exercise of stock-based compensation benefit plans, net of income tax	14	19
Acquisition of subsidiary shares from noncontrolling interests	0	0
Sale of subsidiary shares to noncontrolling interest	0	0
Ending Balance	4,633	6,489	4,633
Noncontrolling Interests
Changes In Equity Disclosure [Line Items]
Beginning Balance	2,945	3,783
Net income	117	174
Total foreign currency translation adjustment, net of income tax	7	49
Total pension adjustments, net of income tax	11	5
Total change in fair value of derivatives, net of income tax	1	17
Capital contributions from noncontrolling interests	55	6
Distributions to noncontrolling interests	(27)	(14)
Disposition of businesses	0	(37)
Issuance and exercise of stock-based compensation benefit plans, net of income tax	0	0
Acquisition of subsidiary shares from noncontrolling interests	(1)	(1)
Sale of subsidiary shares to noncontrolling interest	0	0
Ending Balance	$ 3,108	$ 3,982	$ 3,108

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Derivative Instruments and Hedging Activities

3 Months Ended

Mar. 31, 2013

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

5. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

There have been no changes to the information disclosed under “Derivatives and Hedging Activities” in Note 1—General and Summary of Significant Accounting Policies to Item 8.—Financial Statements and Supplementary Data in the 2012 Form 10-K.

Volume of Activity

The following tables set forth, by type of derivative, the Company's outstanding notional under its derivatives and the weighted average remaining term as of March 31, 2013 regardless of whether the derivative instruments are in qualifying cash flow hedging relationships:

	March 31, 2013
	Current			Maximum
		Derivative			Derivative		Weighted	% of Debt
		Notional			Notional		Average	Currently
	Derivative	Translated		Derivative	Translated		Remaining	Hedged
Interest Rate and Cross Currency	Notional	to USD		Notional	to USD		Term	by Index(2)
	(in millions)						(in years)
Interest Rate Derivatives:(1)
LIBOR (U.S. Dollar)	3,451	$	3,451	4,226	$	4,226	9	70%
EURIBOR (Euro)	605		776	605		776	9	67%
LIBOR (British Pound)	69		105	69		105	13	83%
Cross Currency Swaps:
Chilean Unidad de Fomento	6		271	6		271	9	85%

_____________________________

(1)The Company's interest rate derivative instruments primarily include accreting and amortizing notionals. The maximum derivative notional represents the largest notional at any point between March 31, 2013 and the maturity of the derivative instrument, which includes forward starting derivative instruments. The interest rate and cross currency derivatives range in maturity through 2030 and 2028, respectively.

(2)       The percentage of variable-rate debt currently hedged is based on the related index and excludes forecasted issuances of debt and variable-rate debt tied to other indices where the Company has no interest rate derivatives.

	March 31, 2013
				Weighted
		Notional		Average
		Translated		Remaining
Foreign Currency Derivatives	Notional(1)	to USD		Term(2)
	(in millions)			(in years)
Foreign Currency Options and Forwards:
Chilean Peso	80,558	$	166	<1
Brazilian Real	240		118	<1
Euro	29		41	<1
Colombian Peso	53,208		28	<1
Argentine Peso	83		14	<1
British Pound	3		5	<1
Embedded Foreign Currency Derivatives
Argentine Peso	829		169	11
Kazakhstani Tenge	1,009		7	5
Euro	2		2	10

_____________________________

(1)       Represents contractual notionals. The notionals for options have not been probability adjusted, which generally would decrease them.

(2)       Represents the remaining tenor of our foreign currency derivatives weighted by the corresponding notional. These options and forwards and these embedded derivatives range in maturity through 2014 and 2026, respectively.

	March 31, 2013
		Weighted Average
Commodity Derivatives	Notional	Remaining Term(1)
	(in millions)	(in years)
Aluminum (MWh)(2)	14	7
Power (MWh)	6	3

_____________________________

(1)Represents the remaining tenor of our commodity derivatives weighted by the corresponding volume. These derivatives range in maturity through 2019.

(2)Our exposure is to fluctuations in the price of aluminum while the notional is based on the amount of power we sell under the PPA.

Accounting and Reporting

Assets and Liabilities

The following tables set forth the Company's derivative instruments as of March 31, 2013 and December 31, 2012, firstby whetheror not they are designated hedging instruments, then by whether they are current or non-current, by the extent to which they are subject to master netting agreements or similar agreements (where the rights to set off relate to settlement of amounts receivable and payable under those derivatives) and by balances no longer accounted for as derivatives.

			March 31, 2013						December 31, 2012
			Designated		Not Designated		Total		Designated		Not Designated		Total
			(in millions)						(in millions)
Assets
	Interest rate derivatives		$	-	$	2	$	2	$	-	$	2		2
	Cross currency derivatives			8		-		8		6		-		6
	Foreign currency derivatives			1		87		88		-		81		81
	Commodity derivatives			-		7		7		2		9		11
		Total assets	$	9	$	96	$	105	$	8	$	92	$	100
Liabilities
	Interest rate derivatives		$	523	$	18	$	541	$	544	$	21		565
	Cross currency derivatives			3		-		3		6		-		6
	Foreign currency derivatives			7		11		18		7		7		14
	Commodity derivatives			11		82		93		8		64		72
		Total liabilities	$	544	$	111	$	655	$	565	$	92	$	657

		March 31, 2013				December 31, 2012
		Assets		Liabilities		Assets		Liabilities
		(in millions)				(in millions)
Current		$	18	$	175	$	14	$	186
Noncurrent			87		480		86		471
	Total	$	105	$	655	$	100	$	657
Derivatives subject to master netting agreement or similar agreement:
	Gross (which equals net) amounts recognized in the balance sheet	$	19	$	520	$	25	$	522
	Gross amounts of derivative instruments not offset		(8)		(8)		(9)		(9)
	Gross amounts of cash collateral received/pledged not offset		-		(14)		-		(5)
	Net amount	$	11	$	498	$	16	$	508
Other balances that had been, but no longer need to be, accounted
	for as derivatives at fair value that are to be amortized to earnings
	over the remaining term of the associated PPA	$	181	$	191	$	186	$	191

Effective Portion of Cash Flow Hedges

The following tables set forth the pre-tax gains (losses) recognized in accumulated other comprehensive loss (“AOCL”) and earnings related to the effective portion of derivative instruments in qualifying cash flow hedging relationships (including amounts that were reclassified from AOCL as interest expense related to interest rate derivative instruments that previously, but no longer, qualify for cash flow hedge accounting), as defined in the accounting standards for derivatives and hedging, for thethreemonths ended March 31, 2013 and 2012:

	Gains (Losses)				Classification in		Gains (Losses) Reclassified
	Recognized in AOCL				Condensed Consolidated		from AOCL into Earnings
Type of Derivative	2013		2012		Statements of Operations		2013		2012
	(in millions)						(in millions)
Interest rate derivatives	$	(13)	$	11	Interest expense		$	(32)	$	(32)
					Non-regulated cost of sales			(1)		(2)
					Net equity in earnings of
						affiliates		(2)		(1)
					Gain on sale of investments			-		(92)
Cross currency derivatives		1		14	Interest expense			(3)		(3)
					Foreign currency transaction
						gains (losses)		5		18
Foreign currency derivatives		1		6	Foreign currency transaction
						gains (losses)		2		-
Commodity derivatives		(5)		(6)	Non-regulated revenue			-		(2)
Total	$	(16)	$	25			$	(31)	$	(114)

The pre-tax accumulated other comprehensive income (loss) expected to be recognized as an increase (decrease) to income from continuing operations before income taxes over the next twelve months as of March 31, 2013 is $(146)million for interest rate hedges, $(11) million for cross currency swaps, $(6) million for foreign currency hedges, and $(9) million for commodity and other hedges.

Ineffective Portion of Cash Flow Hedges

The following table sets forth the pre-tax gains (losses) recognized in earnings related to the ineffective portion of derivative instruments in qualifying cash flow hedging relationships, as defined in the accounting standards for derivatives and hedging, for the threemonths ended March 31, 2013 and 2012:

	Classification in Condensed	Gains (Losses)
	Consolidated Statements	Recognized in Earnings
Type of Derivative	of Operations	2013		2012
		(in millions)
Interest rate derivatives	Interest expense	$	(1)	$	(1)
Total		$	(1)	$	(1)

Not Designated for Hedge Accounting

The following table sets forth the gains (losses) recognized in earnings related to derivative instruments not designated as hedging instruments under the accounting standards for derivatives and hedgingand the amortization of balances that had been, but no longer need to be, accounted for as derivatives at fair value, for thethree months ended March 31, 2013 and 2012:

	Classification	Gains (Losses)
	in Condensed Consolidated	Recognized in Earnings
Type of Derivative	Statements of Operations	2013		2012
		(in millions)
Interest rate derivatives	Interest expense	$	1	$	(2)
	Net equity in earnings of affiliates		(6)		-
Foreign currency derivatives	Foreign currency transaction gains (losses)		6		(38)
	Net equity in earnings of affiliates		(3)		-
Commodity and other derivatives	Non-regulated revenue		(21)		14
	Regulated revenue		(3)		(4)
	Non-regulated cost of sales		1		3
	Regulated cost of sales		-		(4)
Total		$	(25)	$	(31)

Credit Risk-Related Contingent Features

DP&L, our utility in Ohio, has certain over-the-counter commodity derivative contracts under master netting agreements that contain provisions that require DP&L to maintain an investment-grade issuer credit rating from credit rating agencies. Since their rating has fallen below investment grade, certain of the counterparties to the derivative contracts have requested immediate and ongoing full overnight collateralization of the mark-to-market loss (fair value excluding credit valuation adjustments), which was $23 million and $13million as of March 31, 2013 and December 31, 2012, respectively, for all derivatives with credit risk-related contingent features. As of March 31, 2013 and December 31, 2012, DP&L had posted $14 million and $5million, respectively, of cash collateral directly with third parties and in a broker margin account and DP&L held $0 million and $0million of cash collateral that it received from counterparties to its derivative instruments that were in an asset position. After consideration of the netting of counterparty assets, DP&L could have been required to provide additional collateral of $5 million and $2 million as of March 31, 2013 and December 31, 2012.

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Long-Term Financing Receivables

3 Months Ended

Mar. 31, 2013

FINANCING RECEIVABLES

6. LONG-TERM FINANCING RECEIVABLES

Long-term financing receivables represent receivables from certain Latin American governmental bodies, primarily in Argentina, that have contractual maturities of greater than one year pursuant to amended agreements or government resolutions. These financing receivables are included in “Noncurrent assets – other” in the Condensed Consolidated Balance Sheets.

Argentina―As a result of energy market reforms in 2004 and consistent with contractual arrangements, our subsidiaries entered into three agreements with the Argentine government called Fondos de inversion Mercado ElectricoMayorista (“Foninvemem Agreements”) to contribute a portion of their accounts receivable into a fund for financing the construction of combined cycle and gas-fired plants. These financing receivables accrue interest and are collected in monthly installments over 10 years once the related plant begins operations. In addition, the Company also receives an ownership interest in these newly built plants once the receivables have been fully repaid. The financing receivables under the first two Foninvemem Agreements are being actively collected since the related plants commenced operations in 2010. However, the financing receivables related to the third Foninvemem Agreement are not currently due as commercial operations of the related gas-fired turbine have not been achieved. Collection of these financing receivables is subject to various business risks and uncertainties including timely payment of principal and interest, completion and operation of power plants which generate cash for payments of these receivables, regulatory changes that could impact the timing and amount of collections and economic conditions in Argentina. The Company periodically analyzes each of these factors and assesses collectability of the related financing receivables. The Company's collection estimates are based on assumptions that it believes to be reasonable but are inherently uncertain. Actual future cash flows could differ from these estimates.

Additionally, our subsidiaries are currently working with the Argentine government to include outstanding receivables of $122 million covered under government resolutions into the third Foninvemem Agreement. On March 26, 2013, the Argentine government passed a resolution to develop a new energy regulatory framework that would apply to all generation companies with certain exceptions. However, as of March 31, 2013 the resolution was not legally binding for our subsidiaries given that certain conditions precedent had not been met. The new regulatory framework will remunerate fixed and variable costs plus a margin that will depend on both the technology and fuel used to generate the electricity. The Company is currently analyzing the impactthat this resolution will have on its subsidiaries in future periods, once it is effective.

The following table sets forth the breakdown of financing receivables by country as of March 31, 2013 and December 31, 2012. The decrease in the long-term financing receivables from December 31, 2012 is primarily related to the impact of foreign currency translation.

	March 31,		December 31,
	2013		2012
	(in millions)
Argentina(1)	$	187	$	196
Dominican Republic		31		35
Brazil		8		8
Total long-term financing receivables	$	226	$	239

________________________

• Excludes noncurrent receivables of $122 million and $120 million, respectively, as of March 31, 2013 and December 31, 2012, which have not been converted into long-term financing receivables and currently have no due date.

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Contingencies and Commitments

3 Months Ended

Mar. 31, 2013

CONTINGENCIES AND COMMITMENTS

8. CONTINGENCIES AND COMMITMENTS

Guarantees, Letters of Credit and Commitments

In connection with certain project financing, acquisition, power purchase and other agreements, AES has expressly undertaken limited obligations and commitments, most of which will only be effective or will be terminated upon the occurrence of future events. In the normal course of business, AES has entered into various agreements, mainly guarantees and letters of credit, to provide financial or performance assurance to third parties on behalf of AES businesses. These agreements are entered into primarily to support or enhance the creditworthiness otherwise achieved by a business on a stand-alone basis, thereby facilitating the availability of sufficient credit to accomplish their intended business purposes. Most of the contingent obligations relate to future performance commitments which the Company or its businesses expect to fulfill within the normal course of business. The expiration dates of these guarantees vary from less than one year to more than 21 years.

The following table summarizes the Parent Company's contingent contractual obligations as of March 31, 2013. Amounts presented in the table below represent the Parent Company's current undiscounted exposure to guarantees and the range of maximum undiscounted potential exposure. The maximum exposure is not reduced by the amounts, if any, that could be recovered under the recourse or collateralization provisions in the guarantees. The amounts include obligations made by the Parent Company for the direct benefit of the lenders associated with the non-recourse debt of its businesses of $24 million.

Contingent Contractual Obligations	Amount		Number of Agreements	Maximum Exposure Range for Each Agreement
	(in millions)			(in millions)
Guarantees and commitments	$	577	20	<$1 - $231
Cash collateralized letters of credit		254	13	<$1 - $169
Letters of credit under the senior secured credit facility		3	5	<$1 - $2
Total	$	834	38

During the three months ended March 31, 2013, the Company paid letter of credit fees ranging from 0.25% to 3.25% per annum on the outstanding amounts of letters of credit.

Environmental

The Company periodically reviews its obligations as they relate to compliance with environmental laws, including site restoration and remediation. As of March 31, 2013, the Company had recorded liabilities of $14 million for projected environmental remediation costs. Due to the uncertainties associated with environmental assessment and remediation activities, future costs of compliance or remediation could be higher or lower than the amount currently accrued. Based on currently available information and analysis, the Company believes that it is reasonably possible that costs associated with such liabilities, or as yet unknown liabilities, may exceed current reserves in amounts that could be material but cannot be estimated as of March 31, 2013.

Litigation

The Company is involved in certain claims, suits and legal proceedings in the normal course of business. The Company accrues for litigation and claims when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company has evaluated claims in accordance with the accounting guidance for contingencies that it deems both probable and reasonably estimable and, accordingly, has recorded aggregate reserves for all claims of approximately $345 million and $321 million as of March 31, 2013 and December 31, 2012, respectively. These reserves are reported on the condensed consolidated balance sheets within “accrued and other liabilities” and “other noncurrent liabilities.” A significant portion of the reserves relate to employment, non-income tax and customer disputes in international jurisdictions, principally Brazil. Certain of the Company's subsidiaries, principally in Brazil, are defendants in a number of labor and employment lawsuits. The complaints generally seek unspecified monetary damages, injunctive relief, or other relief. The subsidiaries have denied any liability and intend to vigorously defend themselves in all of these proceedings. There can be no assurance that these reserves will be adequate to cover all existing and future claims or that we will have the liquidity to pay such claims as they arise.

The Company believes, based upon information it currently possesses and taking into account established reserves for liabilities and its insurance coverage, that the ultimate outcome of these proceedings and actions is unlikely to have a material effect on the Company's consolidated financial statements. However, where no reserve has been recognized, it is reasonably possible that some matters could be decided unfavorably to the Company and could require the Company to pay damages or make expenditures in amounts that could be material but could not be estimated as of March 31, 2013. The material contingencies where a loss is reasonably possible primarily include: claims under financing agreements; disputes with offtakers, suppliers and EPC contractors; alleged violation of monopoly laws and regulations; income tax and non-income tax assessments by tax authorities; and environmental and regulatory matters. In aggregate, the Company estimates that the range of potential losses, where estimable, related to these reasonably possible material contingences to be between$944 million and $1.6 billion. The amounts considered reasonably possible do not include amounts reserved, as discussed above. These material contingencies do not include income tax related contingencies which are considered part of our uncertain tax positions.

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Other Non-Operating Expense (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013 MWh	Mar. 31, 2012
Component of Other Expense, Nonoperating [Line Items]
Other non-operating expense	$ 0	$ 49
Generation Capacity (MW)	125
Innovent [Member]
Component of Other Expense, Nonoperating [Line Items]
Other non-operating expense		17
Generation Capacity (MW)		75
Fair Value		19
Carrying Amount		36
Other Nonoperating Other [Member]
Component of Other Expense, Nonoperating [Line Items]
Other non-operating expense		1
China Generation [Member]
Component of Other Expense, Nonoperating [Line Items]
Other non-operating expense		31
Fair Value		133
Carrying Amount		$ 164

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Dispositions (Details) (USD $) In Millions, unless otherwise specified	0 Months Ended	1 Months Ended	3 Months Ended
	Apr. 26, 2013	Feb. 09, 2012 MW	Mar. 31, 2013	Mar. 31, 2012
Pro Forma Information
Electric Utility Revenue			$ 4,265	$ 4,586
Net Income Loss Attributable To The AES Corporation			82	341
Dispositions
Cartagena ownership interest sold		80.00%
Cartagena generation capacity (MW)		1,199
Cartagena ownership interest prior to sale		70.81%
Proceeds from sale of ownership interest in Cartagena	24	229
Acquirer's option to purchase additional ownership interest in Cartagena		20.00%
Price to exercise option to purchase remaining interest of Cartagena		36
Gain on sale of Cartagena	20	178
Deferred gain on sale of Cartagena		$ 9

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Asset Impairment Expense (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013 MWh	Mar. 31, 2012
Asset Impairment Expense [Line Items]
Asset Impairment Charges	$ 48	$ 10
Generation Capacity (MW)	125
Beaver Valley [Member]
Asset Impairment Expense [Line Items]
Asset Impairment Charges	46	0
Lump Sum Payment Received For Termination Of PPA	60
Kelanitissa [Member]
Asset Impairment Expense [Line Items]
Asset Impairment Charges	0	5
Other Impairment [Member]
Asset Impairment Expense [Line Items]
Asset Impairment Charges	$ 2	$ 5

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Contingencies and Commitments (Tables)

3 Months Ended

Mar. 31, 2013

Contingencies And Commitments Tables [Abstract]

Contingent Contractual Obligations

Contingent Contractual Obligations	Amount		Number of Agreements	Maximum Exposure Range for Each Agreement
	(in millions)			(in millions)
Guarantees and commitments	$	577	20	<$1 - $231
Cash collateralized letters of credit		254	13	<$1 - $169
Letters of credit under the senior secured credit facility		3	5	<$1 - $2
Total	$	834	38

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Investments In Marketable Securities (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Gain Loss On Marketable Securities
Realized losses on the sale of available-for-sale securities	$ 0
Other-than-temporary impairment of marketable securities	0
Gains included in earnings that relate to trading securities held at the reporting date	1	0
Proceeds from sales of available-for-sale securities	1,704	1,523
Gross realized gains on sales	$ 0	$ 1

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Asset Impairment Expense

3 Months Ended

Mar. 31, 2013

IMPAIRMENTS

13. ASSET IMPAIRMENT EXPENSE

	Three Months Ended
	March 31,
	2013		2012
	(in millions)
Beaver Valley	$	46	$	-
Kelanitissa		-		5
Other		2		5
Total asset impairment expense	$	48	$	10

Beaver Valley—In January 2013, Beaver Valley, a wholly-owned 125 Megawatt (“MW”) coal-fired plant in Pennsylvania, entered into an agreement to early terminate its PPA with the offtaker in exchange for a lump sum payment of $60 million which was received on January 9, 2013. The termination was effective January 8, 2013. Beaver Valley also terminated its fuel supply agreement. Under the PPA termination agreement, annual capacity agreements between the offtaker and PJM Interconnection, LLC (“PJM”) (a regional transmission organization) for 2013—2016 have been assigned to Beaver Valley. The termination of the PPA resulted ina significant reduction in the future cash flows of the asset group and was considered an impairment indicator. The carrying amount of the asset group was not recoverable. The carrying amount of the asset group exceeded the fair value of the asset group, resulting in an asset impairment expense of $46 million. Beaver Valley is reported in the US Generation segment.

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Subsequent Events

3 Months Ended

Mar. 31, 2013

SUBSEQUENT EVENTS

18. SUBSEQUENT EVENTS

Dividend―On April 18, 2013, the Company's Board of Directors declared a dividend of $0.04 per outstanding share payable on May 15, 2013 to the shareholders of record at the close of business on May 1, 2013.

Cartagena―On April 26, 2013, the Company's remaining 20% interest held in AES Cartagena was sold upon the exercise of the purchase option by the buyer. See Note 16―Dispositions for further information.

Ukraine Utilities Sale―The sale transaction of Ukraine utilities was closed on April 29, 2013. See Note 15—Discontinued Operations and Held for Sale Businesses for further information.

Recourse Debt―On April 30, 2013, the Company issued $500 million aggregate principal amount of 4.875% senior notes due 2023 (the “Notes”).In connection with this offering, the Company has commenced the tender offers (the “Tender Offers”) to purchase for cash up to $800 million aggregate principal amount of four series of our outstanding senior notes, including any and all of our outstanding 7.75% senior notes due 2014 (the “2014 Notes”), of which $500 million are currently outstanding; up to $100 million of our outstanding 7.75% senior notes due 2015 (the “2015 Notes”), of which $500 million are currently outstanding; up to $100 million of our outstanding 9.75% senior notes due 2016 (the “2016 Notes”), of which $535 million are currently outstanding; and up to $100 million of our outstanding 8.00% senior notes due 2017 (the “2017 Notes” and, together with the 2014 Notes, the 2015 Notes and the 2016 Notes, the “Outstanding Notes”), of which $1,500 million are currently outstanding.We intend to use the net proceeds from this offering, as well as, if necessary, other available funds, to fund the Tender Offers and to pay certain related fees and expenses. If any net proceeds from this offering remain after completion of the Tender Offers, we intend to use such proceeds for general corporate purposes.

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Fair Value (Nonrecurring Unobservable Inputs) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013
Discounted Cash Flow [Member] | Long Lived Assets Held And Used [Member] | Beaver Valley [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Weighted Average Cost Of Capital Input	7.00%
Discounted Cash Flow [Member] | Minimum | Long Lived Assets Held And Used [Member] | Beaver Valley [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Annual Revenue Growth Input	3.00%
Pretax Operating Margin Input	(42.00%)
Discounted Cash Flow [Member] | Maximum | Long Lived Assets Held And Used [Member] | Beaver Valley [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Annual Revenue Growth Input	45.00%
Pretax Operating Margin Input	41.00%
Discounted Cash Flow [Member] | Weighted Average | Long Lived Assets Held And Used [Member] | Beaver Valley [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Annual Revenue Growth Input	19.00%
Pretax Operating Margin Input	25.00%
Market Approach [Member] | Minimum | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Indicative offer prices	12
Market Approach [Member] | Maximum | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Indicative offer prices	38
Market Approach [Member] | Weighted Average | Long Lived Assets Held For Sale [Member] | Wind Turbines [Member]
Fair Value Assets Measured On Nonrecurring Basis Unobservable Inputs [Line Items]
Indicative offer prices	25

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Discontinued Operations and Held For Sale Businesses (Tables)

3 Months Ended

Mar. 31, 2013

Discontinued Operations And Held For Sale Business Tables [Abstract]

Revenue Income From Operations Of Discontinued Businesses Income Tax Expense And Impairment Of Discontinued Operations

		Three Months
		Ended March 31,
		2013		2012
		(in millions)
Revenue		$	147	$	191
Income from operations of discontinued businesses, before income tax		$	13	$	8
Income tax benefit (expense)			1		(2)
Income from operations of discontinued
	businesses, after income tax	$	14	$	6
Net loss from disposal and impairments of discontinued
	businesses, after income tax	$	(36)	$	(5)

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Condensed Consolidated Statements Of Operations (Parenthetical) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Income from operations of discontinued businesses, income tax expense (benefit)	$ (1)	$ 2
Gain/(loss) from disposal of discontinued businesses, income tax expense (benefit)	$ (1)	$ 0

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Inventory

3 Months Ended

Mar. 31, 2013

INVENTORY

2. INVENTORY

The following table summarizes the Company's inventory balances as of March 31, 2013 and December 31, 2012:

	March 31,		December 31,
	2013		2012
	(in millions)
Coal, fuel oil and other raw materials	$	363	$	373
Spare parts and supplies		392		393
Total	$	755	$	766

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Contingencies and Commitments (Details) (USD $)	3 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
Environmental Contingencies
Liability recorded for projected environmental remediation costs	$ 14,000,000
Guarantees Letters Of Credit [Abstract]
The range of expiration dates of guarantees made by the Parent Company	less than one year to more than 21 years
Obligations made by the Parent Company associated with non-recourse debt	24,000,000
Contingent Contractual Obligations [Line Items]
Amount	834,000,000
Number of Agreements	38
Commitments to invest in subsidiaries, excluding letters of credit	2,000,000
Litigation Contingencies
Aggregate reserves for claims deemed both probable and reasonably estimable	345,000,000	321,000,000
Loss Contingency Range Of Possible Loss Minimum	944,000,000
Loss Contingency Range Of Possible Loss Maximum	1,600,000,000
Guarantees
Contingent Contractual Obligations [Line Items]
Amount	577,000,000
Number of Agreements	20
Maximum Exposure Range for Each Agreement	<$1 - $231
Letters of credit under secured credit facility
Contingent Contractual Obligations [Line Items]
Amount	3,000,000
Number of Agreements	5
Maximum Exposure Range for Each Agreement	<$1 - $2
Letters of credit under secured credit facility | Minimum
Contingent Contractual Obligations [Line Items]
Letter of credit fees paid	0.25%
Letters of credit under secured credit facility | Maximum
Contingent Contractual Obligations [Line Items]
Letter of credit fees paid	3.25%
Cash Collateralized Letters Of Credit [Member]
Contingent Contractual Obligations [Line Items]
Amount	$ 254,000,000
Number of Agreements	13
Maximum Exposure Range for Each Agreement	<$1 - $169

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Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2013

Significant accounting policies [Abstract]

Reclassifications

The prior period condensed consolidated financial statements in this Quarterly Report on Form 10-Q (“Form 10-Q”) have been reclassified to reflect the businesses held for sale and discontinued operations as discussed in Note 15—Discontinued Operations and Held for Sale Businesses.

Consolidation

Consolidation

In this Quarterly Report the terms “AES”, “the Company”, “us” or “we” refer to the consolidated entity including its subsidiaries and affiliates. The terms “The AES Corporation”, “the Parent” or “the Parent Company” refer only to the publicly-held holding company, The AES Corporation, excluding its subsidiaries and affiliates. Furthermore, variable interest entities (“VIEs”) in which the Company has a variable interest have been consolidated where the Company is the primary beneficiary. Investments in which the Company has the ability to exercise significant influence, but not control, are accounted for using the equity method of accounting. All intercompany transactions and balances have been eliminated in consolidation.

Interim Financial Presentation

The accompanying unaudited condensed consolidated financial statements and footnotes have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification, for interim financial information and Article 10 of Regulation S-X issued by the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by U.S. GAAP for annual fiscal reporting periods. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, comprehensive income and cash flows. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of results that may be expected for the year ending December 31, 2013. The accompanying condensed consolidated financial statements are unaudited and should be read in conjunction with the 2012 audited consolidated financial statements and notes thereto, which are included in the 2012 Form 10-K filed with the SEC on February 26, 2013 (the “2012 Form 10-K”).

Commitments And Contingencies Policy

The Company is involved in certain claims, suits and legal proceedings in the normal course of business. The Company accrues for litigation and claims when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company has evaluated claims in accordance with the accounting guidance for contingencies that it deems both probable and reasonably estimable and, accordingly, has recorded aggregate reserves for all claims of approximately $345 million and $321 million as of March 31, 2013 and December 31, 2012, respectively. These reserves are reported on the condensed consolidated balance sheets within “accrued and other liabilities” and “other noncurrent liabilities.” A significant portion of the reserves relate to employment, non-income tax and customer disputes in international jurisdictions, principally Brazil. Certain of the Company's subsidiaries, principally in Brazil, are defendants in a number of labor and employment lawsuits. The complaints generally seek unspecified monetary damages, injunctive relief, or other relief. The subsidiaries have denied any liability and intend to vigorously defend themselves in all of these proceedings. There can be no assurance that these reserves will be adequate to cover all existing and future claims or that we will have the liquidity to pay such claims as they arise.

Segment Reporting General Information

The segment reporting structure uses the Company’s management reporting structure as its foundation to reflect how the Company manages the business internally with further aggregation by geographic regions to provide better socio-political-economic understanding of our business. The management reporting structure is organized along six strategic business units (“SBUs”) – led by our Chief Operating Officer (“COO”), who in turn reports to our Chief Executive Officer (“CEO”). Upon the application of the accounting guidance for segment reporting, the Company has identified eight reportable segments based on the six strategic business units: US – Generation; US – Utilities; Andes – Generation; Brazil – Generation; Brazil – Utilities; MCAC – Generation; EMEA – Generation; and Asia – Generation. Corporate and Other— The Company’s EMEA and MCAC Utilities operating segments are reported within “Corporate and Other” because they do not meet the criteria to allow for aggregation with another operating segment or the quantitative thresholds that would require separate disclosure under the segment reporting accounting guidance. None of these operating segments are currently material to our presentation of reportable segments, individually or in the aggregate. AES Solar and certain other unconsolidated businesses are accounted for using the equity method of accounting; therefore, their operating results are included in “Net Equity in Earnings of Affiliates” on the face of the Consolidated Statements of Operations, not in revenue or Adjusted pre-tax contribution (“Adjusted PTC”). “Corporate and Other” also includes corporate overhead costs which are not directly associated with the operations of our eight reportable segments and other intercompany charges such as self-insurance premiums which are fully eliminated in consolidation. The Company uses Adjusted PTC as its primary segment performance measure.  Adjusted PTC, a non-GAAP measure, is defined by the Company as pre-tax income from continuing operations attributable to AES excluding unrealized gains or losses related to derivative transactions, unrealized foreign currency gains or losses, gains or losses due to dispositions and acquisitions of business interests, losses due to impairments and costs due to the early retirement of debt. The Company has concluded that Adjusted PTC best reflects the underlying business performance of the Company and is the most relevant measure considered in the Company’s internal evaluation of the financial performance of its segments.  Additionally, given its large number of businesses and complexity, the Company concluded that Adjusted PTC is a more transparent measure that better assists the investor in determining which businesses have the greatest impact on the overall Company results.   Total revenue includes inter-segment revenue related to the transfer of electricity from generation plants to utilities within Brazil. No material inter-segment revenue relationships exist between other segments. Corporate allocations include certain self-insurance activities which are reflected within segment adjusted PTC. All intra-segment activity has been eliminated with respect to revenue and adjusted PTC within the segment. Inter-segment activity has been eliminated within the total consolidated results. Asset information for businesses that were discontinued or classified as held for sale as of March 31, 2013 is segregated and is shown in the line “Discontinued Businesses” in the accompanying segment tables.

Earnings Per Share Policy

Basic and diluted earnings per share are based on the weighted average number of shares of common stock and potential common stock outstanding during the period. Potential common stock, for purposes of determining diluted earnings per share, includes the effects of dilutive restricted stock units, stock options and convertible securities. The effect of such potential common stock is computed using the treasury stock method or the if-converted method, as applicable.

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Other Income and Expense (Tables)

3 Months Ended

Mar. 31, 2013

Other Income Expense Tables [Abstract]

Components Of Other Income Table

	Three Months Ended
	March 31,
	2013		2012
	(in millions)
Contract termination	$	60	$	-
Gain on sale of assets		1		2
Other		7		16
Total other income	$	68	$	18

Components Of Other Expense Table

	Three Months Ended
	March 31,
	2013		2012
	(in millions)
Loss on extinguishment of debt	$	47	$	-
Loss on sale and disposal of assets		15		24
Contract termination		7		-
Other		6		4
Total other expense	$	75	$	28

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Other Income and Expense

3 Months Ended

Mar. 31, 2013

OTHER INCOME AND EXPENSE

12. OTHER INCOME AND EXPENSE

Other Income

Other income generally includes contract terminations, gains on asset sales and extinguishments of liabilities, favorable judgments on contingencies, and other income from miscellaneous transactions. The components of other income are summarized as follows:

	Three Months Ended
	March 31,
	2013		2012
	(in millions)
Contract termination	$	60	$	-
Gain on sale of assets		1		2
Other		7		16
Total other income	$	68	$	18

Other income of $68 million for the three months ended March 31, 2013was primarily due tothe termination of the PPA at Beaver Valley.

Other income of $18 million for the three months ended March 31, 2012was primarily due to the release of a reserve recorded against inventory at Ballylumford and the receipt of dividends from a cost method investment at Gener.

Other Expense

Other expense generally includes losses on asset sales, losses on extinguishment of debt, legal contingencies and losses from other miscellaneous transactions. The components of other expense are summarized as follows:

	Three Months Ended
	March 31,
	2013		2012
	(in millions)
Loss on extinguishment of debt	$	47	$	-
Loss on sale and disposal of assets		15		24
Contract termination		7		-
Other		6		4
Total other expense	$	75	$	28

Other expense for the three months ended March 31, 2013 of $75 million was primarilydue tothe loss on the early extinguishment of debt at Masinloc, the loss on disposal of assets at Eletropaulo and the termination of a coal contract at Beaver Valley.

Other expense for the three months ended March 31, 2012of $28 million was primarily due to losses on the disposal of assets at Eletropaulo.