Edmar Fagundes de Almeida

Reform in Brazilian electricity industry: the search for a new model

The objective of this paper is to analyse the background of the reform process in the Brazilian Electricity Industry and to examine the adequacy of the new energy policy being implemented as a way to restore the level of investment, in particular private investment. The Brazilian experience of market-oriented reform questions the ability of the operational competition to ensure long-term security-of-supply. This experience shows that the competitiveness of the new projects depends on the costs structure of the power sector. When the power sector is based on cheap hydro-based generation capacity, new projects for electricity generation tend to have higher costs than the installed capacity. In this case, long run marginal cost of expansion tends to grow, creating important political obstacles for implementing a free market for electricity. As the government hesitated in letting all electricity produced to be priced at the marginal cost level, new projects have problems in getting power purchase agreement contracts. New investment and the reserve margins decreased, exposing the country to a power shortage. This paper has shown that the reform process in Brazilian electricity industry opens the way for a more coherent energy policy. If well implemented, the new model can help reduce the risks for new investments, preserving a central role for the private sector in the industrys expansion.

The Performance of Brazilian Biofuels

The increase in the oil price and the worsening of climate change are fostering biofuels programs around the world. Brazil has a long tradition in biofuels. The country is a large-scale producer of ethanol since the 1970s. In 2006, ethanol was responsible for 17% of all vehicle fuel supply in the Brazil. Brazil’s ethanol production from sugarcane is also recognized by its economic performance. In 2005, Brazilian government has launched a biodiesel program. The aim of this report is to make a critical review of Brazilian ethanol and biodiesel programs. It provides lessons about the potential competitiveness of biofuels vis a vis traditional fuels. The document also presents the potential social and environmental impacts of the biofuels in Brazil. The analysis made in this report has been based on an extensive literature review on the subject of biofuels in Brazil. Interviews with experts have also been made in order to clarify some particular issues. The report is divided in two parts: the first is focused on ethanol program and the second to the biodiesel. The first part of the report is divided into the following sections: i) economic performance; ii) the environmental performance; iii) the social performance; iv)energy security performance; v) Brazil as a world-class ethanol exporter. The second part of the report is divided into the following sections: i) economic performance; ii) the environmental performance; iii) Brazil as a world-class biodiesel exporter.

Efficiency and performance in gas distribution. Evidence from Brazil

This article analyses the current state of the gas distribution industry in Brazil, by identifying the main factors that determine its efficiency. In order to test the performance of the industry, we have calculated the firms’ technical efficiency during the period 2001–2009. We analyse whether some economic and technological factors as consumer density, load factor or regulation, among others, have affected the performance of this industry. We show that companies serving markets with different customer characteristics (diversification) have reached higher levels of efficiency and evolved faster. Moreover, the private ownership and price cap regulation are more efficient in relation to public ownership and cost of service regulation. These findings are important to support the improvement of the regulation of gas distribution in the Brazilian states.

The selection environment for gas to liquids technology and technological strategies: Challenging the natural trajectory

The Gas to Liquids technology (GTL) consists of a chemical conversion of natural gas into a stable liquid by means of the Fischer-Tropsch (FT) synthesis. This conversion makes it possible to obtain products that can be consumed directly as a fuel (for example, Diesel) or special products such as lubricants. The original version of the FT process, using coal as the raw material, was commercially developed in Germany in the 1940s, during the Second World War. Nevertheless, with the exception of Sasol, a South African company, the FT process was abandoned by chemical companies after the war.

Developing the gas industry in Brazil: Competition or regulation?

Abstract Recent developments in the Brazilian gas supply industry are reviewed. Two main questions are addressed. First, is territorial monopoly the best approach for the industrial organisation of an infant gas supply industry (GSI)? Second, how should the regulatory framework of the GSI be related to a competition‐oriented regulatory framework in the electricity supply industry (ESI)? Our view is that the regulation used in North America and in Europe to develop the GSI, when their gas industries were in their infancy, has not been adapted for the Brazilian case. New driving forces are bounding the development of the GSI both in mature and infant markets. An innovative regulatory framework is required that will preserve market power equilibrium and regulatory coherence between the GSI and ESI.

High Efficient Motors in Brazil:a Perspective

Similarly to any other industrial country, electric motors are extensively used in Brazil to produce stationary motive force. Relatively low cost as compared to other motors, large range of power capacity and no emission of pollutants were the main inducing forces for the rapid spread of electric motors in the economy: They required lower investments, were clean and provided flexibility to organize the workshop floor.