erico cardoso professor at fundacao fundacao getulio vargas – business college

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Erico CardosoProfessor at Fundacao Fundacao Getulio Vargas – Business CollegeProfessor at Universidade Federal Fluminense – Business CollegeMaster Degree in Administration at IBMEC – Concentration Area: Finance and Stock Market - Specialization in Financial Market – ANDIMA/IERJ – 2002MBA in Management and Corporate Finance – Fundação Getulio Vargas – 2001Posgraduation in Financial Administration – Fundação Getulio Vargas –1999Undergraduation in Business Administration - Universidade Federal Fluminense - 1999

Jorge KreimerProfessor at Fundacao Getulio VargasMBA in Corporate Finance – Fundação Getulio Vargas – 2006Undergraduation in Business Administration - Bennett - 2001

Who am I?

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AGENDA

Reasons for InvestmentDifficultiesSolutionsProgram Luz para Todos – Energy for all program

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Reasons For Investment

Imagine yourself...

Without comunication for speaking with somebody you love;

Without energy for study or work;

Without TV or Internet to see landscapes, others countries;

Without radio to hear your favourite song;

Without fuel to heat up your food...

There are 1.7 billion people in the world that lives in this way.

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fds


Access of the World Electricity

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A quarter of the World’s People (1.7 billion) don’t have eletricity in their houses and 2.0 billion use the traditional fuels coming from biomass.

Those people spend more money using ineficient energy than they would spend if they had eletric power in home

It is important to allow more people to attain higher standard of living. (Reduction of poverty).

Reduction of the indoor air pollution from burning tradicional fuels (major factor of the causes of respiratory illness that it kills almost 2 million children under the age of five year. It kills more than AIDS, Malaria and Tuberculosis.

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It allows the change of the productive time spent by the women and children collecting firewood and biomass. They can study or work.

Social impacts: Create jobs and raise incomes, transfer skills and build local capacity, transfer a share of fiscal revenues and increase the investment in social infrastructure.

It increases income from the poor people.

It is more expensive to buy several candles than pay monthly fee for energy services.

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Strong correlation between the devolpment of a country and its consumption of energy:

-3%

-1%

1%

3%

5%

7%

9%

11%

13%

15%

1953 1959 1965 1971 1977 1983 1989 1995

Tx cresc PIB Tx cresc cons

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Planet Earth

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Difficulties

The price of installing a transmission line is very high in rural areas.

The private sector doesn’t fell attracted for investment in social reasons.The ROI (Return on Investment) is better in urban areas than in rural areas.

Poor people use not be a former opinion.

The maintenance of the project is expensive.

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Solutions

ESCO (Energy Service Companies) can reduce the cost of electricity in rural areas.

"ESCO's - Companies of Services of Energy's Conservation - they are deprived companies that have as objective accomplishes businesses in the extent of the reduction of costs and consumption of energy and usefulness used in the compounds industrial, commercial, of services, among other users of energy, without affecting the quality and amount of the product or offered service." (ABESCO, 2004).

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Solutions

It develops, elaborates the form and finances projects of energy efficiency.

It installs and maintains the efficiency of the equipment of energy efficiency involved.

It measures, monitors and verifies the economy of the project of energy.

It assumes the risk that the project will save the amount of energy guaranteed.

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THE ENERGY FOR ALL PROGRAM (O PROGRAMA LUZ PARA TODOS)

Universalization of the Access and Use of the Electric

Power

Generation of Socioeconomic Benefits

Solutions

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* Creation and development in 2003

* Actions since 2004

Parternerships PNUD, World Bank, USAID, NGO’s

Adhesion in 2003 to GVEP (Global Village Energy Partnership)

“LUZ PARA TODOS”THE ENERGY FOR ALL PROGRAM

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MAIN IDEAS AND GOALS1-Reduction of poverty and hunger using

the energy as a development vector

2-Social Inclusion, Maintainable Growth and Quality of Life

3-Energy acccess to 12 million people (most of them in the rural areas) until the year of 2008

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Coordinated by the Ministry of Mines and Energy and executed by Eletrobras

Other Participants:

- STATES

- EXECUTIVE AGENTS (Dealers of Electric Power and Cooperatives of Rural Eletrification)

- MINISTRIES

- ANEEL (Federal Agency that rules the Energy market)

- NATIONAL AND STATES’ COMISSION AND COMITTEES.

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Technological Options Program use three alternative actions,

that compose the service to the demands of each area:

1 – Network's Extension2 – System of Generation

Decentralized with Isolated Networks

3 – Individual Systems of Generation

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Eletrobrás Mixed Economy Company - Controlled by the Federal Govermment - Shares negociated in the Stocks Exchange (Brazil, USA, Spain)

Holdind of the Eletrobrás GroupEletrobrás Controls: FURNAS - CHESF – CGTEE

ELETRONORTE - ELETROSUL ELETRONUCLEAR


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Process of Implementation Eletrobras - multiple functions

- To sign the “Term of Commitment” among the Federal Government, States and the Executive Agents after analyzing the “Program of Works” presented by the Executive Agents, as well as directing it to Ministry of Mines and Energy (MME)

- Liberation of financial resources after contract signature and to prove the appropriate use of the resources, besides inspecting the works physically. Eletrobrás elaborates and it sends, monthly or when requested, reports seeking to provide the program partners on information regarding the works and financial resources

- Administration of the program main financial resources (the “sectorial funds” RGR and CDE)

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AC8.851

AM9.287

PA45.528

AL – 29.883BA

104.980

CE - 46.762

ES – 17.449

GO10.770

MA81.042

MT24.403

MS10.205

MG86.519

PB - 12.924

PR12.782

PE - 57.630

PI10.098

RJ - 6.940

RN - 16.265

RS20.622

RO8.190

RR1.014

SC - 15.716

SP – 27.121

SE - 18.364TO

15.618

AP0

AC8.851

AM9.287

PA45.528

AL – 29.883BA

104.980

CE - 46.762

ES – 17.449

GO10.770

MA81.042

MT24.403

MS10.205

MG86.519

PB - 12.924

PR12.782

PE - 57.630

PI10.098

RJ - 6.940

RN - 16.265

RS20.622

RO8.190

RR1.014

SC - 15.716

SP – 27.121

SE - 18.364TO

15.618

AP0

AchievementsNUMBERS REACHED IN CONNECTIONS ACCOMPLISHED IN THE BRAZILIAN HOMES

Brasil

698.963

source: Eletrobrás - updated in 01/12/2006

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Achievements NUMBERS REACHED IN CONNECTIONS + CONTRACTS

source: Eletrobrás - updated in 01/12/2006

Total

Contracts Connections

Total Brazil

1,109,774 698,963

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AchievementsPHYSICAL POSITION OF GEOGRAPHICAL CONNECTIONS

source: Ministry of Mines and Energy - updated in 27/12/2006

ACCUMULATED CONNECTIONS

CONNECTIONS IN PROCESS

PEOPLE BENEFITED WITH

ACCOMPLISHED CONNECTIONS

PEOPLETO BE

BENEFITED WITH WORKS IN PROCESS

NORTH 126.487

53.294

632.435 144.530

MIDDLE-WEST

478.660

TOTAL 991.536 159.825 4.957.680 799.125

GEOGRAPHICAL AREAS

SOUTHEAST

SOUTH

NORTHEAST

236.326

28.906

2.393.300 266.470

62.275 1.181.630 311.375

79.841 11.564 399.205 57.820

70.222 3.786 351.110 18.930

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Achievements

In the beggining of 2007

ENERGY FOR ALL “Luz Para Todos” has reached

More than 5.000.000 people !

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The End

Contacts:

Erico Cardoso

E-mail: [email protected]

Contacts:

Jorge Kreimer

E-mail: [email protected]

erico cardoso professor at fundacao fundacao getulio vargas – business college

Documents

energy services

investment access

consumption of energy

social reasons

lovewithout energy

ineficient energy

users of energy

poor people