“brazil’s moment in the sun” energy front – a key part of its economy jerson kelman – ceo,...

“Brazil’s Moment in the sun”Energy front – a key part of its economy

Jerson Kelman – CEO, Light S/A

Brazilian energy source is renewable

45,9

12,9

6,7

54,1

87,1

93,3

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Brazil (2007)

Worldwide (2006)

OCDE Countries(2007)

RenewableNon-renewable

Installed capacity:

104 GW

74% is hydro

Peak demand:

64 GW

(comparable to England or Italy)

Average production:

51GW X 8760 h/y = 447 TWh/y

90% is hydro

Brazil power sector at glance (2008)

The transmission system

4 000 kmEurope

4 000 km

Isolated System

Interconnected System

Per capita consumption of electricity

Centralized dispatch

In order to take advantage of hydrological diversity, energy is transported through long distances.Power plants in the same river basin are own by different companies.

CEMIG

FURNAS

AES-TIETÊ

CESP

CDSA

Consórcios

COPEL

TRACTEBEL

ITAIPUBinacional

Rio Grande

Rio Paranaíba

Rio Tietê

Rio Paranapanema

Rio Iguaçu

CEMIG

FURNAS

AES-TIETÊ

CESP

CDSA

Consórcios

COPEL

TRACTEBEL

ITAIPUBinacional

Rio Grande

Rio Paranaíba

Rio Tietê

Rio Paranapanema

Rio Iguaçu

Spot price is low most of the time...

Generation

Free Consummers Captive Consummers

DistributionTransmition

Distribution Distribution tarifftariff

TUSTTUST TUSD TUSD

TUSTTUST

TUSTTUST

PPA (energy)

Free Consummers

TUSD - TUSD - Distribution network charge + taxes TUST – Distribution network charge + taxesDistribution Tariff = Energy + TUSDDistribution Tariff = Energy + TUSDPPA – Power Purchase Agreement

Long term power purchase agreements (PPAs)

Results of recent auctions of energy(competition for the market, rather than in the market)

Sales: ~ 150 TWh/year

37% Hydro e 67% Thermal

(natural gas, oil and coal)

Total value: ~ US$ 110 billion

Did Brazil run out of sites to build new hydro plants?

USAUSA

CongoCongoIndonesiaIndonesia

PeruPeruRussiaRussiaChinaChina

ColombiaColombiaIndiaIndia

BRAZILBRAZILCanadaCanada

ItalyItalySwedenSweden

NorwayNorwayJapanJapan

GermanyGermanyFranceFrance

10000 20 40 60 80Source: EPE

Hydropower plants in the Amazon river basin

What would be the alternatives?

Distance of potential hydro plant sites to the large cities

Rio de Janeiro: pacification & formal economy

Rio de Janeiro: pacification & formal economy