1

Doing Business in Brazil

Lauro FiuzaVice President of the ABEEólica Board

2

Brazil in the Global Scenario

Source: GWEC

Ranking 2013

3

201215th Place

2.5 GW

201313th Place3.4 GW

201410th PlaceForecast

1 China 91.42

2 USA 61.09

3 Germany 34.25

4 Spain 22.96

5 India 20.15

6 UK 10.53

7 Italy 8.55

8 France 8.25

9 Canada 7.80

10 Denmark 4.77

11 Portugal 4.72

12 Sweden 4.47

13 Brazil 3.4614 Poland 3.39

15 Australia 3.24

16 Turkey 2.96

17 Holland 2.69

18 Japan 2.66

19 Romania 2.60

20 Ireland 2.04

4

Brazil in Figures

Source: ABEEólica/ANEEL5

Hydroeletric86.067%

Biomass11.49%

Petroleum Derived7.76%

Coal3.389465

3%

Natural Gas12.510%

Thermal Other1.41%

Thermal Nuclear1.992%

Wind3.53%

Installed Capacity [GW]

Brazilian Power Matrix 2013

*The photovoltaic source has 5.9MW

of installed capacity.

Source: ABEEólica6

Accumulated Installed Capacity (MW)

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

27.1 235.4 245.6 323.4 606.2 931.81,430.5

2,507.1

3,445.3

7,310.6

9,861.0

11,363.211,413.6

13,751.4

New (MW) Accumulated (MW)

Source: ABEEólica/ANEEL7

536.3 MW

351.9 MW

1,972.1 MW

Wind Farms Locations

34.5 MW

3,914.0 MW

2,320.3 MW

951.6 MW

69.0 MW

3,335.7 MW

28.1 MW

2.5 MW

236.4 MW

TOTAL

13,752.3 MW

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Competitive Advantages

Source: CCEE9

Capacity Factor

jan/13 feb/13 mar/13 apr/13 mai/13 jun/13 jul/13 aug/13 sep/13 oct/13 nov/13 dec/130%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

33%35%

30%

23%25%

26%

30%

42%

45%47%

46%

36%

Source: ABEEólica/ONS10

Complementarity

jan/13 feb/13 mar/13 apr/13 mai/13 jun/13 jul/13 aug/13 sep/13 oct/13 nov/13 dec/130

20,000

40,000

60,000

80,000

100,000

120,000

140,000

455 458 459

346385 390

467

659

685

736716

583

Energy Stored in All Reservoirs (GWh) Wind Energy Generation (GWh)

Source: ABEEólica/CCEE11

LER 2013

Hired: 1,505.2 MW

Power Purchase Agreements

Auctions from 2009 to 2012

Hired: 7,040.7 MW

Total 2013 = 4,710.6 MW

PROINFA

Hired: 1,203.0 MW

Source: ABEEólica12

Average Price per year

2004 - PROINFA 2009 2010 2011 2012 2013 $-

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

$140.00

$160.00 $150.09

$78.57

$65.59

$48.25

$40.09

$50.21

Fonte: ABEEólica13

WTG Tower Blade

Acciona Alstom Aeris Energy

Alstom Engebasa LM

Gamesa Intecnial Tecsis

GE Wind RM Pernambucana Wobben Windpower

Impsa Tecnomaq

Siemens Torresbrás

Suzlon Wobben

Vestas

WEG

Wobben Windpower

Manufacturers in Brazil

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Opportunities & Challenges

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Advantages

• Long Term Credit

– BNDES: competitive loan terms

• Credit Lines for Manufacturers

– FINAME from BNDES

– Tax Incentives (Federal, State and Municipal)

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Opportunities

• Local Supply Chain Demand

• Consistent Growth of Wind Power within the Power Matrix

• High Demand for Business Services and Consulting

• Independent O&M Players

• Training Programs for Industry Professionals

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Challenges

• Brand New Industry

– Early stage database

• Labor

– Build expertise

• Technology

– Adjustment to Brazilian wind conditions

– R&D

• Grid

• Infrastructure

• Logistics

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Brazilian Innovation Chain in Wind Power

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What is this?

• Enhanced knowledge exchange environment;

• Online platform for interaction between companies, universities, research centers and developers;

• Structure that enables the partnership between the agents in support of research and development; and

• Structure that optimizes the use of resources.

events

Online platform

periodic

forum

meetings of innovation

Knowledge network

R&D projects

partnership Technological

Institute -company

RBIEE

Brazilian Network for the Development of Wind Power

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Forecast

21

State Planning by EPE (Power Planning Agency)

Private Sector Estimates

Forecast

Decennial Energy Plan

2012 2016 2022

Capacity(GW)

Participation in the Matrix

(%)Capacity

(GW)Participation in the Matrix

(%)Capacity

(GW)Participation in the Matrix

(%)

1.8 1.5 10.8 7.3 17.5 9.5

ABEEólica

2012 2016 2022

Capacity(GW)

Participation in the Matrix

(%)Capacity

(GW)Participation in the Matrix

(%)Capacity

(GW)Participation in the Matrix

(%)

2.5 2 11.3 7.7 21.8 11.9

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Access: www.abeeolica.org.br

Thank you!