POWER February 2012 - 72

POWER IN BRAZIL
zilian companies have to confront harsh
competition coming from Asian newcomers.
A clear reflection of how international
energy equipment producers have pledged
their commitment to the Brazilian market
is that, despite Brazil not being renowned
for industrial competitiveness, many equipment
producers are opening new production
plants in Brazil or expanding existing ones.
This is the case for IMPSA, an international
energy equipment company that recently
enlarged its Brazilian aerogenerator
(wind turbine) production plant in Suape.
IMPSA Executive Vice-President José Luis
Menghini clarified the benefits brought by
his company's establishment in the country:
" By installing our production plants in Brazil,
IMPSA got closer to its Brazilian clients,
being able to satisfy the growing demand
for its aerogenerators and hydroelectric
equipment. Besides, the local character of
our R&D has resulted in capital advantages
to our competitiveness. Unlike our competitors',
IMPSA's aerogenerators are perfectly
conceived for the specific wind conditions
of the Brazilian coast. "
One of the most senior foreign companies
present in the heavy equipment sector
is General Electric, which arrived in Brazil
92 years ago and offers a wide range of
equipment for generation, distribution, and
transmission companies. Marcelo Prado,
marketing director of GE Energy for Latin
America underlined how GE's equipment
fits the Brazilian market: " GE provides, for
example, flexible turbines adapted to the
specific conditions of the Brazilian energy
market; depending on the level of hydroelectric
reservoirs, those gas turbines can be
turned on and off without reducing performance
or damaging equipment. "
GE also provides its clients with integrated
services aiming to ensure the perfect
performance and operation of its equipment.
As Prado stated: " General Electric
services are offered on a service contract
or service as-needed basis and range from
operation and maintenance activities to
upgrading services and emissions control
services. Services contracts are especially
indicated for those clients who acquire our
heavy equipment such as substations, transformers,
electric motors, and generators. "
Balancing Development and
Sustainability: Brazil's Environmental
and Social Challenge
Brazil's famed natural beauty is a significant
point of pride and a major driver of the tourism
sector. The challenge for energy companies is
to maintain the balance between conservation
and the need for further development to power
a rapidly growing economy.
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" In a country like Brazil, it is difficult to
discuss energy generation without discussing
the sustainable use of environmental
assets, " said Izabella Teixeira, Brazil's minister
of environment. " We are working hard
in our ministries to develop a new environmental
agenda that takes into consideration
the challenges for our sustainable development
over the next 20 years. "
" The environmental question is very
important; we need to create a national
consensus on how to minimize costs and
how clean we want our energy to be, " said
Charles Lenzi, president of the Brazilian
Association of Clean Energy Producers.
A major dilemma for power companies
is that much of the country's unexploited
hydro potential lies along the Amazon
River, which is populated by a number of
endangered species and many indigenous
peoples. There has been international outcry
over planned development of large-scale
hydroelectric dams, highlighted by the Belo
Monte controversy.
The Belo Monte dam, which is to become
the country's second-largest hydroelectric
dam in installed capacity at almost
11,200 MW, has been in development since
the late 1970s but has continuously been
halted due to environmental concerns regarding
the depletion of fisheries and the
resulting effect on the livelihood of the local
people, who rely on fishing for their income.
The construction phase was slated to
commence in late 2011, but in September
2011, a judge barred any activity related to
" building a port, using explosives, installing
dikes, building canals and any other infrastructure
work that would interfere with the
natural flow of the Xingu river, thereby affecting
local fish stocks. "
Though the project is supported by the
Brazilian government, it remains to be seen
whether or not the dam will go forward as
planned.
The fault does not lie with the regulatory
system or the companies themselves, according
to Juan Piazza, CEO of environmental
consultancy JGP Consultoria, which develops
environmental assessments and biodiversity
surveys for the energy industry. " The
environmental permitting system for hydropower
projects in Brazil is adequate, and the
quality of environmental assessments has
improved significantly. Hydropower project
developers need to invest up front on project
engineering and environmental assessments.
Once preliminary permits are obtained, projects
are opened to bidding through auction
and all front-end costs, previously audited by
the regulatory agency, are passed on to the
winning bidder. Hence, it is in the interest of
the front-end developer to produce a highPOWER
| February 2012
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POWER February 2012

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