Energy Management in Brazil August 9th, 2011 Rio de Janeiro | RJ

1. US – Brazil Industrial Energy Efficiency Workshop 2011 Energy Management in Brazil August 9th, 2011 Rio de Janeiro | RJ By: Pedro Paulo da Silva Filho | Grupo SAGE Desenvolvimento: SAGE

2. Grupo SAGE Grupo SAGE consists of the Brazilian companies SAGE Consultoriaand SAGE Comercial. Created in 1997, is headquartered in Rio de Janeiro, with a branch in Brasília (Brazil) and a representative office in Quito (Ecuador), and has been actuating in Brazil and Latin America. Grupo SAGE has worked on energy management and consulting of Energy and Environmental initiatives, throughout Brazil and Latin America. We also design and implement energy and utilities management systems.

3. Grupo SAGE - Operational Sectors -

4. Grupo SAGE In more than 14 years of operation, Grupo SAGE has been worked in several countries, such as: Peru Bolivia Ecuador Colombia Nicaragua Costa Rica Panama Brazil Canada Mexico Argentina Chile Uruguay Paraguay El Salvador Dominican Republic Guyana Lesotho Kenya Ghana Zambia

5. Energy Managementin Brazil

6. Energy Management in Brazil- Context - • Current situation • PNE (National Energy Plan from 2010 to 2030) • Incorporates the Energy Efficiency theme • Mention the future development of a PNEf– National Energy Efficiency Plan • Targets to reduce the national power demand by 10% until 2030

7. Energy Management in Brazil- Current Practices - • Companies have no internal meters, only utility meter for total plant • Lack of specific energy performance indicators • Lack of knowledge about energy management • Lack of understanding that energy is not a fixed cost!

8. The Great Mystery of Mankind [ ENERGY BILL]

9. Available Tools

10. Energy Management in Brazil- Available Tools - • Using an Electricity Management System • MGI (Monitoring, Targeting and Reporting) • ISO 50.001

11. Electricity Management System

12. Energy Management in Brazil- Electricity & Utilities Metering System - Remote Management & Supervising Web Server Cable Modem Ethernet Remote Management & Supervising Remote Management & Supervision Utility Meter Local / Remote Operation Remote Management & Supervising Electricity & Utilities Meters Status + Control

13. Energy Management in Brazil- Electricity & Utilities Metering System -

14. Energy Management in Brazil- Electricity & Utilities Metering System -

15. Energy Management in Brazil- Electricity & Utilities Metering System -

17. Energy Management in Brazil- MGI: Definition - • An initiative of Procel-Eletrobrás • Under an MGI program, a site is divided into several Energy Accountability Centers (EACs), where energy consumption is monitored on a regular basis. • By analyzing past performance, a standard energy consumption level is set for each EAC. This makes it possible to relate the energy used to a relevant variable. • Actual energy use is compared to this baseline and the findings are presented to managers. Further, targets are set for the achievement of better-than-standard performance.

18. Energy Management in Brazil- MGI: Benefits - • Established technique to help reduce energy costs through improved energy efficiency and energy management control. • It enables commercial enterprises to manage energy use as a controllable resource. • It also contributes to better environmental performance, better production budgeting, and more effective environmental management activities within recognized standards such as ISO 14000.

19. Energy Management in Brazil- MGI: Investments - • Investment needed to put an energy M&T system into operation include: • Tools (metering, software for data analysis) - critical for monitoring water and energy use; • Capacity building to develop in-house competence in establishing benchmarks for conservation and loss minimization activities; • Studies to identify, evaluate, and justify other energy efficiency initiatives.

20. Energy Management in Brazil- MGI: Implementation Steps - • Step 1: Conduct an energy audit to identify the energy efficiency opportunities • Step 2: Implement an energy management structure that will operate the program • Step 3: Review metering structure to generate proper information • Step 4: Operate the energy management system

21. Energy Management in Brazil- MGI: Inputs - M&T System Manualentry Handhelddatalogger Existingcomputerfiles AutomatedMetering Corporatefile server (Table Required)

22. Energy Management in Brazil- MGI: Cicle - Establish Standards for Energy Use Establish Targets for Energy Use Select Energy Cost Drivers Select Energy Accountable Centers Install Additional Meters Review and Verify Energy Savings (Avoided Costs) What are “critical success factors” for improving energy efficiency?

23. Energy Management in Brazil- MGI: Cicle - What are “critical success factors” for improving energy efficiency? Measure Consumption Measure Output Set Targets MGI Implementation Plan Plan Actions MGI Performance Contract Take Action

24. Energy Management in Brazil- MGI: Cicle - Awareness of Potential Management Commitment Preliminary Audit Monitor MGI Implementation Plan Analyze Target Awareness & Training No or Low- Cost Measures Pre-investment Studies Capital Investment “Critical success factors” for sustainable energy efficiency Monitoring, Targeting and Reporting (MGI) enables systematic use of information management technology to improve energy efficiency

26. Energy Management in Brazil- ISO 50.001: Background - • International standard that specifies energy management system requirement, upon which an organization can develop and implement an energy policy, and establish objectives, targets, and action plans which take into account legal requirements and information related to significant energy use • Used by any corporation (in size or economic activity) • Based on Plan-Do-Check-Act (PDCA) approach • Relevant for Greenhouse gas emission reduction

27. Energy Management in Brazil- ISO 50.001: Background - • Contributions/experiences from Denmark, Sweden, Spain and Ireland • Former experience with the EU 16001 standard • Integration ISO 9001, ISO 14001

28. Energy Management in Brazil- ISO 50.001: PDCA - Continual improvement framework

29. Energy Management in Brazil- ISO 50.001: Requirements - • Establishing, implementing, maintaining and improving an energy management system • Define and document the scope and boundaries of its EnMS • Determine how it will meet the requirements of ISO

30. Energy Management in Brazil- ISO 50.001: EnMS - Energy management system model

31. Energy Management in Brazil- ISO 50.001: Requirements - • Top management responsibility • Energy policy • Energy planning • Energy baseline • Energy performance indicators • Energy objectives, targets and management action plans

32. Energy Management in Brazil- ISO 50.001: Requirements - • Implementation and operation • Competence, training and awareness • Communication • Documentation • Checking • Monitoring, managing and analysis • Others • Management review • Periodic review of energy policy and performance

33. Associated Results

34. Energy Management in Brazil- Associated Results - • Goals: • Improved quality + reduced losses • Increased volume of production • Competitive advantage • Sustainable initiatives • Reduction of costs (up to 20%)

35. MuitoObrigado!Thankyou! Pedro Paulo da Silva Filho (+55 21) 2532-0054 pedropaulo@gruposage.com.br www.gruposage.com.br