The Brazilian model of electric energy generation is essentially hydroelectric. About 70% of the national generation capacity is made up by large and medium hydroelectric plants and Small Hydroelectric Plants. The option for this model is justified by the existence of large upland rivers, fed by abundant tropical rains that constitute one of the largest reserves of sweet water in the world. In addition, the hydroelectric energy is, in general, cheaper as it relates to the operational aspect. Today, however, the hydraulic benefits for large and medium plants are increasingly located farther away from the large centers, with significant impacts on the costs of transmission. Due to the social-environmental impacts, the hydroelectric plants are increasingly more subject to restriction for obtaining licensing. This way of generation, however, presents an emission of CO2 that is a lot lower than that of the thermoelectric plants.

Second, in the Brazilian energetic matrix are the thermoelectric plants that have won importance as a complementation of the hydraulic matrix, especially as of the end of the 90's. There is also a significant percentage of imported energy involved, especially by the energy that corresponds to that Paraguayan energy generated in Itapu.

In January of 2009, Brazil consumed energy produced by 2.033 plants with installed capacity of 102,949 MW. The forecast is that this capacity increases 37,363 MW in the next few years, because of more than 750 foreseen projects, many of which already being implemented.

The Agencia Nacional de Energia Elétrica - Aneel - is the federal agency responsible for regulating the initiatives relative to the generation of energy in the country, whatever the modality proposal may be.

Major electric energy generation modalities in Brazil and in the World.

The main modes of generation use forces of nature to spin a turbine that moves the generator. The mechanic energy produced in the turbine is converted into electric energy through a generator.

Hydroelectric power plant

In the hydroelectric power plants, the force of the waterfalls spins the turbines that activate the generating shaft and produce electric energy. The hydroelectric power plants come in varied sizes as a result of the capacity to use the river (outflow and waterfall), being the projects with a maximum capacity of 30 MW and reservoir of up to 30 km called Pequenas Centrais Hidrelétricas (PCHs) [Small Hydroelectric Power Plants].

The cost of implementation of this type of project varies between 2,500 R$/kW plants with capacity above 500MW) and 5,000 R$/kW (PCHs), being generally financed, with a relevant part of third parties' capital in the long term, so that the debt can be paid with the generation of cash from the project itself. The high volumes of initial investment, however, are compensated by high EBITDA margins reached with the lox cost of O&M and the need of remuneration of the capital invested initially.

The expansion of the hydroelectric generation in the country has happened through auctions promoted by ANEEL, in which the winner that that offering the lowest energy price. To participate in the auctions, the hydroelectric project must already have a first environmental license called Previous License. Subsequently, the project should comply with a series of requirements and social-economic determinants to warrant also the Installation License and the Operation License.

 

Thermoelectric Plants

In this modality, electric energy is obtained as of the burning of fuels, such as coal, oil, oil derivatives, natural gas and biomass (sugar cane bagasse, pasture or rice peel, for instance). The thermoelectric plants can be of a simple cycle (in which the burning of fuel generates the pressure required to spin the turbine that will move the generator) or of a combined cycle (that combines generation systems run with the burning of the fuel and another one run by steam derived from the same burning).

This type of undertaking requires an initial investment lower than a hydroelectric plant (1,500 R$/kW at the combined cycle plants and 1,.700 R$/kW at the simple cycle plants); however, its EBITDA margin also tends to be lower when compared with a hydroelectric plant in view of the high costs of O&M and expenses with the purchase of fuel.

At the present time, this source of energy corresponds to 20.70% of the installed capacity in Brazil, which is essential to reduce the dependence of the hydroelectric plants and reduce the risk of rationing in the case of a reduction in the volumes of water in the reservoirs of the hydroelectric plants. Another advantage of the thermoelectric plants is that they can be installed near the large consuming centers, thus reducing the losses of transmission and improving the quality of the energy supplied (tension and frequency).

 

Nuclear

The nuclear plants at present obtain energy as of the controlled fission of the nucleus of the atom of enriched uranium. The intense heat produced by this operation is used to warm the water and turn it into the steam that pins the turbine, in a process similar to that of the thermoelectric plants. That is why this type of plant is also called thermonuclear.

Because of the technological complexity and the risks associated to the residue produced by the process, which still needs to be treated and confined adequately, only 1.81% of the installed capacity in Brazil comes from nuclear plants. The two nuclear plants in operation are located in Angra dos Reis (RJ).

 

Aeolian

In this modality, the electric energy is produced by generators moved by the force of the winds, called aero generators. These pieces of equipment are like modern "wind mills", usually grouped Aeolian parks to make the production profitable.

In Brazil, this source of energy has been triggered by the Federal Government through Proinfa - Programa de Incentivo às Fontes Alternativas de Energia [Program of Incentive to Alternative Sources of Energy], as a way to diversify the Brazilian energetic matrix. There are Aeolian parks operating in Brazil in the states of the Northeast, Southeast and South, with installed capacity of total generation of 398MW, which represents 0.36% of the capacity of national generation. However, due to the costs increasingly more competitive and to the incentives of the Federal Government, this source of renewable energy should present a significant growth during the next few years.

 

Photovoltaic Energy (Solar)

Also known as solar energy, it is produced through panels of silicon with photovoltaic cells that generate electric energy under the incidence of the sun.

The photovoltaic effect (process that converts solar radiation in electric energy) occurs when photons (existing in solar rays) fall on silicon atoms, causing the emission of electrons, which make up the electric current. This energy is stored in battery banks to be used during the night or in periods of low solar radiation.

This modality of generation has proven to be economically feasible in remote regions or in small facilities. However, countries like the United States, Japan and Germany have projects for the use of photovoltaic energy in urban centers.

Tidal Energy (Maremotriz)

The electric energy generator can, also, be triggered as of the movement of the tides, the force of the waves, the marine currents or even the differences in temperature of the oceans. Among these modalities, the most common is the one that uses the movement of the tides to fill a reservoir and generate energy in a process similar to that of the hydroelectric plants.

It is a way of energy generation that is considered clean and sustainable, but requires very specific conditions to warrant the economic feasibility of the production.

For more information on the scenario of generation in Brazil, , click here.