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Brazil’s Development Bank Doubles Energy Financing to US$ 4.3 Billion

Financing by the Brazilian Development Bank (BNDES) for the energy sector totaled 8.3 billion Brazilian reais (US$ 4.3 billion) over the last 12 months ending in August this year, expansion of 106% over the previous period.

In the accumulated result for the first eight months of 2008, financing granted by the bank for energy projects totaled 4.5 billion reais (US$ 2.4 billion). In this case, the increase was 73%.

The head of the Electric Energy Department at the BNDES, Nelson Siffert, said that disbursements accumulated this year should reach, by December, a total of 9 billion reais (US$ 4.7 billion) for investment in sector projects.

"These disbursements are seasonal and usually rise in the last quarter of the year. We still believe that investment in the area should total 9 billion Brazilian reais (US$ 4.7 billion)," stated Siffert. Last year, the bank's disbursements for the sector totaled 8.13 billion reais (US$ 4.2 billion).

The BNDES has a project portfolio of 15,000 megawatts (MW) of energy, with 9.6 billion (US$ 5 billion) to be financed and investment of 11.5 billion reais (US$ 6 billion). From 2003 to June this year, the BNDES supported 210 electric energy projects, totaling financing of 32 billion (US$ 16.7 billion).

In the area of generation, 142 projects were approved for a total of 15,214 MW, of which 37 are hydroelectric power plants, with 11,130 MW. Credit for the generation of energy totaled 21.3 billion reais (US$ 11.1 billion), which resulted in investment of 36.2 billion (US$ 18.9 billion).

Also in the period from 2003 to June 2008, the BNDES approved 34 projects in the area of energy transmission, with 10,000 MW of basic network transmission lines. The financing reaches 6 billion reais (US$ 3.1 billion), with investment of 10 billion reais (US$ 5.2 billion).

In the sector of distribution, 31 projects count on the investment of 5 billion reais (US$ 2.6 billion). The investment reaches 8.5 billion reais (US$ 4.4 billion). "We have been trying to foster, in distribution, the efficiency of electric energy, in the sense of seeking greater economy and having more efficient processes in distribution and rationalization of energy," stated Siffert.

Siffert believes that the search for BNDES financing, in the area of electric energy, should present more significant growth next year. "We are going to enter a trajectory of growing disbursements in energy, also in 2009, 2010 and 2011, as the volume of projects being developed also guarantees sustainability of disbursements for coming years. They are projects with long maturity."

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