Brazil: The wealth of opportunities

Author: | Published: 1 Oct 2009
Email a friend

Please enter a maximum of 5 recipients. Use ; to separate more than one email address.

Investors looking into the Brazilian energy market will find that despite the unfavourable global financial market, opportunities abound for investment in the Brazilian energy sector.

Looking at the global market, a noticeable trend is the migration of energy-intensive industries to developing countries. This is due to a number of factors such as cost of labour and land, social license and environmental restrictions, logistics and available resources.

In Brazil, electricity consumption is on the rise due to an increase in industry production to service both international and local markets. As a result of sustained economic growth over past, inflation control and social inclusion programmes, more and more people are becoming consumers. Existing consumers are also raising their expenditure levels and buying new products, which require more energy to produce, and consuming more energy at home with goods such as televisions, computers and air conditioners. Increase in Brazil's GDP, population, per capita consumption and the rise in corporate investment due to a more predictable and stable environment have resulted in a constant increase in energy demand by the industrial sector.

According to Brazilian government estimates, an investment of R$142 billion is required in energy generation between 2009 and 2017, of which R$79 billion is for projects that have not yet been auctioned. Brazil needs to expand its installed capacity to 155,000 mw by 2017, an increase in 54,000 mw from current capacity, of which 16,000 mw have already been auctioned.

Increasing energy production requires not only new energy projects, but also new transmission lines. Many new projects are being auctioned in remote parts of the country where transmission is almost as large an undertaking as constructing the power plants themselves. By 2017, Brazil will require 36,387 km in transmission lines and 71,357 mva in transformers.

To add to this favourable market, the Brazilian government has launched a growth acceleration programme called Programmea de Aceleração do Crescimento (PAC) seeking to strengthen the Brazilian economy by means of heavy government and private investments in infrastructure. Energy is one of the cornerstones of the PAC, and as the programme also happens to be part of the political platform for President Luiz Inácio Lula da Silva, candidate in the 2010 presidential election, no effort is being spared to ensure the project takes off. Actual disbursements of funds are not progressing at the speed the central government would have wished for, but the incentive is there for companies wishing to invest in infrastructure in Brazil in the near future.

The current project portfolio and unique features of the Brazilian market offer unrivalled opportunities for investors, equipment suppliers and engineering procurement contracts (EPC) in the energy sector.

The Brazilian energy market

Brazil faced a severe energy crisis from 2000 to 2001 as a result of inadequate planning, over-dependency on hydropower (which at that time accounted for 95% of the energy generation matrix) and a drought period.

The government was forced to implement energy rationing measures to impact energy consumption for years. The energy crisis led to a decline in GDP growth in Brazil from 4.3% in 2000 to 1.3% in 2001. Energy consumption levels subsequently took five years to return to pre-rationing levels.

In order to avoid future energy crises and improve long-term planning, in 2004 the Brazilian government introduced a new regulatory model for power generation in Brazil, named the New Model.

In accordance with New Model regulations, most new power projects participate in auctions organised by Agência Nacional de Energia Elétrica (ANEEL), the electric energy agency, for long-term power purchase agreements (PPAs) with energy distributors, who are required to enter into long-term contracts for 100% of their demand via a reverse auction system. More importantly, these long-term PPAs were aimed at providing sufficient cash flow certainty to allow the financing of these projects using project finance structures.

Under the auction system, there are specific auctions for existing energy and for new energy to be delivered in three or five years. Within the new energy auctions, there are specific auctions targeted at certain energy sources, such as an auction targeted at biomass sources (mainly sugar cane bagasse) held in 2008, and an auction to take place in 2009 exclusively for wind projects.

In addition, as a result of the auction structure, new energy projects do not compete with existing projects for long-term contracts, and are able to charge higher tariffs. Most new energy projects participate in these auctions, and consequently may be awarded long-term PPAs well before they are due to start operating, thereby ensuring a predictable cash flow which facilitates project finance structures.

In the New Model, energy can also be traded in the Ambiente de Contratação Livre (ACL), the Brazilian spot market equivalent, subject to certain requirements. Certain large consumers are able to enter into contracts in the ACL, and therefore some power projects can benefit from both a long-term PPA and short-term contracts with the so-called free consumers. Large hydropower plants, for example, are currently allowed to sell 30% of their power generation in the ACL.

The Brazilian energy matrix

The installed capacity of the Brazilian power sector is just over 100,000 mw. In 2008, hydropower accounted for 73.1% of Brazil's electricity generation. Electricity imports accounted for 8.6%, natural gas accounted for 6%, biomass 4.8%, oil and oil by-products 3%, nuclear 2.8%, coal and coal by-products 1.6% and wind power 0.1%.

While a largely renewable energy matrix is a source of pride for Brazil, the lack of diversification in the energy matrix has already shown its consequences.

Nevertheless, the most significant investments as of 2009 are precisely in hydropower plants, namely the Santo Antonio and Jirau projects (under construction) and the Belo Monte project expected to be auctioned in 2009. Given Brazil's huge potential for hydro generation and the installed construction capacity, the trend is for continued investment in hydropower.

On the other hand, both government and industry are aware that relying on hydropower alone is risky, and concerns have been raised about delays in the completion of large hydropower plants mainly due to environmental issues during the construction phase.

Moreover, despite increased investment in hydropower, storage capacity has not expanded, as environmental concerns mean that hydro projects are being built with less storage capacity than in the past. Therefore, these projects are still exposed to rain level risks.

Environmental barriers to new hydropower projects are being slowly lowered, as there has been significant political pressure on environmental agencies to reduce lead times to review licensing applications, especially for projects enrolled in the PAC programme. However, there are still delays and regulatory uncertainty regarding licensing aspects. As a result, many investors are seeking to develop projects based on other energy sources.

Recently, coal power plants have become a focus of interest to many investors, as they are being seen as a viable alternative for larger projects.

Other sources such as gas, wind and nuclear power are also promising, with a number of relevant projects on the horizon including the construction of the 1.300 mw Angra 3 nuclear power plant after a 23-year interruption.

Main energy sources in Brazil


Brazil's potential for hydropower generation is estimated at approximately 260 gw, of which only 30% are currently being used. 40% of Brazil's hydropower potential is in the Amazon basin.

Clearly, there is still significant potential for the development of new hydropower projects, but developing large hydro projects in remote areas poses a number of challenges.

Traditionally, hydropower projects in Brazil involved large dams to allow multi-annual storage and flow regulation, but due to the environmental constraints, small, run-of-the-river hydro projects are becoming increasingly popular in Brazil.

Large Hydro

Most of Brazil's available large hydro potential is located in remote regions. The most important large hydropower projects are being built in these areas, which entail not only technical complexity arising from large scale construction far from larger cities, but also transmission difficulties and the need to grapple with issues such as environmental protection, neighbouring indigenous populations and endangered species.

Successful implementation of these projects hinges on the availability of exceptional project management skills, careful planning and monitoring of all licensing aspects and close contact with government and local community representatives.

Developers of large hydro projects need to ensure that they comply fully with the intricate licensing requirements at the municipal, state and federal levels, which sometimes give rise to issues relating to overlapping authority and conflicting demands.

The 1,087 mw Estreito power plant, 3,150 mw Santo Antonio plant and the 3,300 mw Jirau plant, all in the Amazon region, have faced a number of licensing difficulties and lawsuits seeking to suspend the projects due to environmental concerns. However, construction is now reportedly on schedule for all three projects, and Jirau and Santo Antonio have announced that the projects may be completed ahead of schedule.

Among the planned projects to expand Brazilian energy production, the 11,000 mw Belo Monte hydropower plant, expected to be auctioned by the end of 2009, is certainly the most impressive. The Belo Monte power plant will be the largest power plant in Brazil after Itaipu.

Other planned hydro projects expected to be auctioned by the Brazilian government in the near future are the 1,328 mw Serra Quebrada power plant, the 1,080 mw Santa Isabel power plant, and five power plants in the Rio Tapajos Complex, totalling 10,692 mw.

Small Hydro

Small hydro projects are becoming increasingly popular in Brazil, especially run-of-the-river projects. Small hydropower plants offer the benefits of hydro generation, but can be installed closer to larger cities and involve smaller reservoirs. However, these smaller reservoirs mean that energy production by these projects may be hindered by drought periods.

Small hydropower plants of up to 30 mw have benefited from government incentives, and therefore have been a popular choice for companies investing in renewable energy, in several cases for self-consumption. There is a push to extend the benefits granted to small hydro projects to projects with up to 50 mw capacity.

In the 2009 A-3 auction, 31 small hydro projects enrolled, offering 390 mw of installed capacity.

Thermal generation power plants

Thermal generation power plants remain popular in Brazil as a viable alternative to diversify the Brazilian energy matrix. Heavy reliance on hydro generation has had adverse consequences in the past, and other renewable energy sources are not yet competitive from a price perspective.

Thermal power plants are relatively quick to build and tend to enjoy a competitive advantage in the A-3 auctions (for delivery of energy within three years from the auction).

Therefore, there are still plenty of opportunities for thermal generation projects to be awarded long-term contracts under government sponsored auctions, especially considering the relatively fast construction, predictability and operation schedule.


The development of clean coal technologies, low coal prices and the ability to build large scale projects in shorter time frames than equivalent sized hydropower projects have provided an incentive to coal fired power plants.

Brazil has the tenth largest coal reserves in the world, but coal production is under-developed. Companies investing in large-scale coal projects are entering into long-term off take agreements with coal suppliers either in Brazil or abroad to ensure that the project has a guaranteed supply of coal. An increase in coal power generation would boost Brazilian coal production levels.

Among relevant coal projects, in July 2009 MPX Energia and EDP Energias do Brasil secured over $1 billion in financing for the 720 mw Pecém I coal-fired power plant in the state of Ceará provided by BNDES and an international syndicate led by the Inter-American Development Bank.

Other coal power plants in MPX's pipeline are the 2100 mw Porto do Açu power plant in the State of Rio de Janeiro and the 600 mw UTE MPX Sul in the State of Rio Grande do Sul.

Vale has also announced plans to build a 600 mw coal-fired power plant in Barcarena, State of Pará, which should require approximately $900 million in investments.

Tractebel, in its turn, is planning to build a 540 mw power plant in Seival, which could be used to export energy to neighbouring Uruguay or participate in one of the Brazilian government's auctions.

According to the Brazilian Ministry of Mines and Energy, coal-fired energy production is expected to increase from the current 1,400 mw to 6,500 mw in 2030. Given current industry plans, however, the Ministry's estimate may prove to be shy.


During the Brazilian energy crisis of 2001, oil-fired power plants featured prominently in the government's emergency energy programme.

As they are fast to build, oil-fired power plants continue to play a significant role to meet shorter-term demands within the Brazilian energy matrix.

However, some existing plants have been required under the terms of their PPAs to convert to gas operation, and a growing trend is the construction of bi-fuel power plants that can run on gas or oil.


Many gas-fired power plant projects faced supply issues in the past, which negatively affected the reputation of gas-fired power plants in Brazil. The well publicised disputes with Bolivia have brought additional uncertainty.

As a response to Bolivian gas supply issues, Petrobras has increased investments in gas production and transportation. When gas from the Santos Basin is made available, Brazil should have abundant quantities of gas available on the national market. Market sources expect that the Santos Basin could produce up to 100 million mw per day of natural gas. Investment in gas pipelines should also help expand the national gas supply, which are already stimulating new gas-fired power projects, but uncertainty remains as to short and medium term availability of natural gas.

Nevertheless, gas was the fastest growing energy source in 2008. In the 2009 ANEEL A-3 energy auction, 54 out of 119 enrolled projects were gas-fired, and total 11,344 mw installed capacity, as compared to eight oil-fired projects offering 1,477 mw capacity.

Gas-fired projects are suitable for larger installed capacity, and are therefore a viable alternative to coal and hydropower. As an example, MPX Energia has revealed plans to build a 3,300 mw gas-fired power plant in the Porto do Açu industrial complex.

It is possible that once abundant gas becomes a reality, gas-fired power plants may acquire a significant role in the Brazilian energy matrix and become a strong competitor to coal energy generation. However, while gas-fired plants are friendlier on the environment, coal is likely to continue to be a cheaper source of fuel. It remains to be seen whether environmental concerns or price will have the upper hand.


Biomass-fired power plants using sugar cane bagasse are the next big thing in the renewable energy sector in Brazil.

Brazilian ethanol, produced from sugar cane, is more efficient and less polluting than corn-based ethanol. The Brazilian government has sponsored the expansion of ethanol markets in Brazil and as a result of government incentives and lower prices compared to gasoline, more than 90% of new cars manufactured in Brazil are flex-fuel and can run on ethanol, gasoline or any combination of the two.

Ethanol production has surged to cater to growing internal demand and exports to ethanol-friendly countries such as Japan. Green fuel policies in a number of countries portend huge potential for the ethanol trade, and the ability to use sugar cane bagasse, which would otherwise go to waste, to run co-generation facilities is an excellent way to reduce production costs, create extra revenues for ethanol and sugar producers with the sale of any energy surpluses, reduce waste and generate energy from a renewable source. However, it is worth noting that as bagasse is a by-product of the sugar and ethanol industry, its availability is affected by the fluctuations of sugar and ethanol in the international commodities market. This may be especially relevant in projects primarily aimed at energy generation.

A very large number of sugar and ethanol producers have started to invest in energy generation as a significant element of their business plans, not just as a sideline activity.

In 2008, the Brazilian government held a biomass-only energy auction in which 2,379 mw were traded. In 2009, as there will not be an auction specifically targeted at biomass sources, 20 sugar cane bagasse-fired projects have enrolled in the standard A-3 auction to be held by ANEEL, offering 995 mw capacity.

Several ethanol producers have turned to BNDES for financing to install or expand energy co-generation facilities.

However, sugar and ethanol producers were severely hit by the global financial crisis with falling commodity prices. Many producers were caught unprepared and are now facing liquidity issues. Some have gone bankrupt, others are seeking to attract strategic investors, and others are cash-strapped.

As a result, financing for sugar cane bagasse co-generation projects is harder to come by at the moment as financiers are weary of potential insolvency risks of sugar and ethanol producers.

On the other hand, sugar and ethanol producers have become targets for private equity investors and M&As, and the crisis may help consolidate the Brazilian sugar and ethanol market into larger players.

These larger players are in general still able to access financing sources successfully.

In January 2009, BNDES approved a R$392 million financing to Bioenergética Vale do Paracatu (Bevap) for construction of a sugar cane processing facility for ethanol production and energy co-generation with 80 mw installed capacity in the state of Minas Gerais.

In February 2009, Inter-American Development Bank disbursed $153 million in loans for the construction of two ethanol production and power co-generation facilities in Brazil.

In June 2009, BNDES approved a $788 million financing for Cosan, a major ethanol producer, for ethanol production and energy generation.

Investment in wind farms began in earnest in Brazil with the 2002 Programme of Incentives for Alternative Electricity Sources (PROINFA), a programme for incentive of renewable energy sources. The PROINFA was aimed at small hydro, wind and biomass sources.


Wind energy prices are still not competitive compared to other energy sources, which is why specific incentives are required for this industry to develop in Brazil, but with one of the most consistent wind patterns in the world for energy generation, wind power projects are expected to become increasingly popular and production costs should diminish over time. According to official estimates, Brazil has 143 gw in wind power potential. However, experts say that actual potential may be as high as 300 gw.

The PROINFA auctioned 1,443 mw of wind energy PPAs for 54 projects, but a 60% local content requirement at a time when there was only one turbine manufacturer in Brazil and uncertainties regarding certain aspects of the PPA such as the sale of carbon credits led to mixed results in the implementation of projects.

Another factor is that the PROINFA fostered the entrance of new players in the energy market, with a relevant portion of the available contracts being awarded to companies that were not related to existing concession-holders. The outcome of this initiative was that some of companies that were awarded PPAs lacked the resources or the expertise to carry the projects through to completion, or had difficulties financing the project.

As a result, out of the 54 projects that were awarded PPAs as of January 2009 only 17 of those projects, representing 456 mw were operating, 15 projects totalling 324 mw were still under construction, and the remainder had not even commenced construction.

The government has changed its tactics, and the wind-only auction set to take place in 2009 is expected to be a success. More than 13,000 mw in 441 projects have been registered for the auction, and many projects are led by large players in the energy field, which have the expertise and credit relationships required to succeed in obtaining financing for the projects. Most projects registered for the 2009 auction range between 25 and 50 mw, but there are six projects with more than 100 mw capacity, totalling 806 mw among them.

Local content requirements have been watered down, recognising that existing local production (two turbine manufacturers only, Wobben and Impsa) is not capable of supplying all market participants, but clear incentives are being laid for manufacturers in the wind industry to settle in Brazil in anticipation of an ever growing local wind power market.

The government has announced that auctions targeted at wind energy generation are here to stay, which is excellent news for investors and equipment suppliers.


Solar energy seems like a natural choice for Brazil amongst renewable energy sources, but solar energy generation is still at a very early stage compared to other alternative energy sources such as wind or biomass. The cost of equipment is still very high, and there are no major government incentives specifically targeted at solar energy like those being implemented in the US or Europe. The first government initiatives to foster solar energy are only now being introduced.

The government announced in March 2009 that low-income houses to be built under the PAC programme would have solar energy panels. The Ministry of Mines and Energy was, as of July 2009, working on a solar energy incentive programme, which would be integrated with local industry capacity. However, the extent of these initiatives is still unclear, as is the question of whether there will be specific tax exemptions for solar energy panels and how exactly the government is to set about implementing these programmes.

While solar power generation is not yet widespread in Brazil, companies are beginning to invest in pilot projects in anticipation of growing demand and government incentives for solar power. MPX Energia, for example, has announced the construction of a one mw pilot solar power plant in the state of Ceará and is developing partnerships with solar equipment manufacturers.


Brazil has one of the five largest uranium reserves in the world. Following a global trend, the Brazilian government seems to be embracing the view that nuclear energy is here to stay, and should play a role in the Brazilian energy matrix.

Brazil has two nuclear power plants, 650 mw Angra 1 and 1,300 mw Angra 2, both located in Rio de Janeiro. The 1,300 mw Angra 3 power plant which was part of the original plan is finally going to be built after a 23-year delay. The environmental license was issued in March 2009, and Eletronuclear, the state company responsible for construction, has requested a R$4.5 billion financing from BNDES (out of a total R$7 billion investment required to complete the plant) to resume construction of the Angra 3 plant. Foreign banks have also been mentioned as potential financing providers.

Government officials have mentioned that nuclear power generation expansion plans include two nuclear power stations in Northern Brazil, with six reactors each, and two other similar stations in Southeast Brazil. Each station would have a capacity of approximately 6,000 mw. However, a state monopoly on the entire nuclear production chain, including uranium development, has limited development of this source.


Brazil's continental size coupled with the fact that the majority of electricity consumption is in the southeast and south of Brazil, where most industrial activity is concentrated, whereas the largest power projects are located in remote areas, require significant investments in transmission in order to allow power being produced across the country to reach consumers.

While most of the Brazilian electricity grid is interconnected in the National Integrated System, a large part of the northern Brazil is still in an isolated system. One of the government's priorities is to integrate northern Brazil into the national grid.

The large hydropower plants being built in remote regions such as the Amazon basin would be of little use without an integrated transmission system. In order to integrate the Santo Antonio and Jirau power plants into the national grid, 2,500 km in transmission lines will have to be built.

The integration of Manaus, Macapá and other cities in the Amazon region into the National Integrated System will require a further 1,810 km in transmission lines. Integration is expected to be completed in 2012.

By 2017, Brazil will require 36,387 km in transmission lines and 71,357 mva in transformers. According to Brazilian government estimates, R$25 billion in investment is required between 2009-2017 in transmission lines and R$14 billion in substations.

Due to the auction model, transmission projects that are awarded contracts in the government sponsored auctions have predictable cash flows and are therefore suitable candidates for project finance structures.

It is worth bearing in mind, however, that for many of these projects completion risks will be greater than usual as a result of the complexities of building transmission lines that cut through the Amazon forest and other remote regions of the country. This added complexity should be adequately reflected in the project financing structure to ensure proper risk allocation.

Financing energy projects

BNDES and local development banks are the largest source of funding for Brazilian energy projects.

Between 2003 and June 2008, BNDES financed 155 energy generation projects, totalling 19,668 MW of installed capacity, and more than R$30 billion out of a total of investments exceeding R$53 billion. Out of these projects, 36 were hydro, 4 thermal, 80 small hydro, 30 biomass and 5 were wind farms. During this period, BNDES also financed the construction of more than 10,000 km in transmission lines. Among the largest financings were R$7.2 billion for the Jirau power plant, R$6 billion for the Santo Antonio power plant (both part of the Madeira project), R$2.66 billion for the Estreito plant, R$1.66 billion for Foz do Chapecó and R$1 billion for Simplício, all of them large hydro projects and all enrolled in the PAC programme.

BNDES also created a bridge credit line in 2008 targeting infrastructure projects, especially energy, so as to allow companies to start building while they negotiate long-term credit facilities, all as part of the government push to accelerate the implementation of infrastructure projects.

The restraints in access to credit worldwide have affected but not prevented the financing of infrastructure projects in Brazil, as the Brazilian development banks have taken on the role of liquidity providers and have made a point of allocating resources to infrastructure projects in line with PAC programme directives. In 2009, BNDES received an additional $100 billion cash injection to ensure that resources would be available for qualified projects.

Other Brazilian development banks have been active in the financing of energy projects, but sometimes regional banks lack the project finance expertise required to structure a sophisticated project finance structure, which may lead to delays in obtaining credit approvals.

BNDES on the other hand is used to dealing with sophisticated project finance structures. BNDES lends either directly or with a pass-through to commercial banks. Joint financing by BNDES and international development banks is also common, especially for larger projects.

Large projects usually involve a syndicate of banks, which adds a layer of complexity to project finance structures due to Brazilian law restrictions.

Under Brazilian law, the concept of trusts does not exist and a mandate structure must be adopted to accommodate the syndicate agent. As a result, loan documentation is usually signed by all syndicate members, a factor which creates additional paperwork every time a change is required.

Another challenge confronting potential investors in the energy sector is the increasing number of private equity funds investing in energy projects under fundo de investimento em participações (FIP) structures, which are special investment vehicles that benefit from certain tax incentives. FIPs cannot, as a rule, give guarantees in favour of invested companies unless they obtain special dispensation.

However, it is a standard requirement of BNDES project finance that the shareholders of the debtor pledge the company shares in favour of BNDES, in addition to other requirements, such as equity support arrangements and corporate guarantees prior to project completion.

Another relevant aspect is that under Brazilian law step-ins are not allowed. A legal restriction exists regarding a creditor's ability to keep the assets given as a debt guarantee in case of foreclosure. There is a legal requirement for assets to be sold to third parties, which necessarily entails some difficulty when trying to reflect typical international finance step-in structures in project financings governed by Brazilian-law.

The solutions that are usually adopted to provide lenders with a certain degree of step-in rights are powers-of-attorney and share usufruct structures. These allow lenders to manage the project until a third-party sale is carried out, as well as agreements allowing for the assignment of project contracts away from the debtor in case of a default.

Some lenders also attempt to circumvent legal restrictions by having the buyer repay the debt in kind (with the project assets), but said workarounds may be challenged in Brazilian courts, and we do not have a history of case law on this subject.

In this respect, the Brazilian Public Private Partnership (PPP) Law, which came into effect in 2004, has introduced a major innovation in the Brazilian legal system aimed at facilitating project finance structures for PPP projects, in that it specifically allows step-ins and explicitly recognises the fundamental role that financiers play in rendering a PPP project ultimately viable.

Other peculiarities of the Brazilian legal system that affect project finance structures include restrictions on floating charges and burdensome registration requirements for purposes of perfecting the security package.

As regards energy project finance in particular, it is also essential to bear in mind that, depending on the regulatory status of the project, a number of additional restrictions may apply to the project's ability to give security and to the lenders' ability to enforce the debtor's obligations.


This article has sought to introduce international investors to the basic features and prospects for energy generation in Brazil.

Looking at the broader investment market, Brazil accounts for close to 50% of South America's GDP. In the recent past, meaningful investments have been made in logistics to increase trade within the continent and we have witnessed economic integration at levels that were unimaginable some 10 years ago. As the country with the largest and most modern industrial base, Brazil is expected to benefit from this closer relationship with neighbouring economies in the coming years.

In addition, Brazil has significant trade levels with Asian countries on raw materials, and there is growing interest of Asian countries in Brazil, as evidenced by ever increasing investments, especially Chinese, in the Brazilian economy.

We may add that land availability at lower cost, an increasing internal market, specialised labour with comparable lower pay, solid political institutions in a consolidated democracy, including independent regulatory agencies and a fully operational independent judiciary, a lack of political conflicts with neighbouring countries, and lack of internal religious or ethnical conflicts are all elements which, combined with a favourable attitude towards foreign investment, help consolidate Brazil's position as a prime destination for new energy investments. Brazil has also consolidated a culture of arbitration of commercial disputes during the past six years.

Investors looking to tap into the opportunities Brazil has to offer in the energy sector are, however, warned to act fast, as many of the best investment opportunities are concentrated in 2009 and 2010.

About the author

Pedro Aguiar de Freitas is a senior partner at Veirano Advogados in Rio de Janeiro and São Paulo offices.

He came back to Veirano in 2009 after more than 20 years, returning to the firm where he started his career.

Before joining Veirano, he occupied the position of General Counsel and Secretary to the Board of Directors of VALE, one of the largest business conglomerates in Latin America, for six years.

He also held the positions of General Counsel of Brasil Telecom SA, for three years after its privatisation, and General Counsel of Organizações Odebrecht for eight years and Senior Counsel at the International Finance Corporation – IFC for six years. He started his career with Veirano (which was then the Rio de Janeiro office of Baker & McKenzie), having also practiced in Chicago at the Baker & McKenzie headquarters.

He is a board member of several organisations, including the Mining Committee of the International Bar Association (IBA) where he serves as a secretary. He was vice-chairman and president of Instituto Innovare a non-political organization dedicated to promote a more speedy and efficient judiciary in Brazil.

He is also a board member of Amcham, Britcham, CESA and Fundação Getúlio Vargas.
Contact information

Pedro Aguiar de Freitas
Veirano Advogados

Av. das Nações Unidas, 12.995 / 18º andar
São Paulo - SP - Brasil
Tel:  +55 11 5505 4001
Fax: +55 11 5505 3990

About the author

Ana Carolina Barretto has been a member of Veirano Advogados since 1997. She specialises in project development and finance, M&A and other corporate transactions, focusing mainly on the energy and infrastructure sector. In recent years, she has represented sponsors, lenders, contractors, equipment and O&M suppliers in connection with the acquisition, development, financing, construction and operation of power, infrastructure, mining and alternative energy projects in Brazil.

She gained her Bachelor of Laws degree from the Pontifícia Universidade Católica do Rio de Janeiro, Brazil. She also holds a Magister Juris degree, funded by a Chevening/FCO scholarship, and a Master of Studies in Legal Research degree from the University of Oxford.
Contact information

Ana Carolina Barretto

Veirano Advogados

Av. Presidente Wilson, 231 / 23° andar
Rio de Janeiro – Rio de Janeiro – Brasil
Tel + 55 21 3824 4747
Fax + 55 21 2262 4247