Brazil´s Plan for Energy Efficiency Eduardo Coelho Corrêa

1. Simposio Internacional: Eficiencia energética para el desarrollo nacional Brazil´s Plan for Energy Efficiency Eduardo Coelho Corrêa SMES/GGEE – Corporate Manager for Energy Efficiency World Energy Council representative 25 / 05 / 2011

2. Agenda • Foundations of an Energy Policy • History • Brazilian Energy Policy Structure • Energy Efficiency

3. Foundations of an Energy Policy • Meeting the current and future energy demands, to ensure economic growth and income distribution in a sustainable manner: • Meeting the Current Energy Demand Current • Projections for Future Energy Matrix • Projections of Energy Demand • Security of Supply • Reliability • Stability • Accessibility • Operational Safety • Sustainability

4. Foundations of an Energy Policy • Specific Policies: • Prioritization of energy sources and respective strategic and sustainable technological routes • Awards for Energy Efficiency in Generation • Pricing policy that encourages the rational use of energy • Investment in Infrastructure for Rationalization of Means of Transportation • Investments in the rational use • Standards and Requirements for Projects

5. Foundations of an Energy Policy $$ rational MWh <<<<<< $$ aditional MW Environmental Licences Supply Chain Maintenance Operation

6. Foundations of an Energy Policy $$ rational MWh <<<<<< $$ aditional MW Environmental Licences Supply Chain Maintenance Operation Decoupling Energy Efficiency Auctions

7. Decoupling Patti's family uses 972 kWh during July, with a peak demand of 2.3 kW. Jon's family uses 855 kWh during July, with a peak demand of 6 kW per month. Patti's family uses an evaporative cooler for air conditioning, which doesn't use as much energy as Jon's family central air conditioning. However, Patti's family has two young adults at home that stay up late playing video games, often while simultaneously watching TV. The hours when everyone is asleep and lights are off is reduced to two or three hours per night rather than the usual six to seven hours per night. Jon's family uses more energy for air conditioning but everyone goes to bed by midnight, even on weekends. http://www.utilipoint.com/issuealert/article.asp?id=3121

8. Decoupling

9. “Decoupling”

10. WEC - National Energy Policies Worldwide Energy Efficiency Policies around the World: Review and Evaluation Contents Acknowledgements Remerciements Foreword Summary Résumé 1 Introduction 2 Energy Efficiency Trends 3 Evaluation of Energy Efficiency Policies and Measures 4 Conclusions and Recommendations Annexes Bibliography www.worldenergy.org/publications/energy_efficiency_policies_around_the_world_review_and_evaluation/1166.asp

11. History • Winston Churchill required that oil burning battleships be built and, in doing so, was able to increase ship speed and reduce refuelling time. The consequence of that decision was reliance on Middle Eastern oil and this gave rise to the creation of the Anglo-Persian Oil Company, the forerunner of British Petroleum; • During the period of the Cold War, the United States and the former Soviet Union focused largely on domestic energy production rather than reliance on international trade, which might be at risk of interruption; • The Reagan administration believing that the best way to achieve energy security was to couple market forces with a suitable insurance policy involving diplomatic and military action and the filling up of strategic reserves". In this regard, a cornerstone of US energy policy has been engagement with the Middle East and the building of strong relationships with countries like Saudi Arabia..

12. Histórico • Therefore, the belief of the 1980s and 1990s that is perhaps now seen as misplaced and incompatible when issues such as energy conservation and microeconomic efficiency is also optimal from a macroeconomic standpointenvironmental management are considered; • The resurgence of energy policy and government intervention has led to the establishment of principles such as having "no regrets". This policy aims to strike a balance between meeting energy demands and sustainability.

13. History Finon (1994) concludes that energy policy trends are dictated by three factors: • First: government recognition of the negative externalities associated with energy consumption and a consequent desire to minimize those externalities through intervention that supports energy efficiency and demand-side management; • Second: the degree to which energy policy features on governmental agendas depends on energy prices, in that security of supply concerns ease while international energy prices are low; • Third, Finon (1994) concluded that political ideology has great impact on the: level of government intervention in energy markets

14. Brazilian Energy Policy Structure CNPE: The “Conselho Nacional de Política Energética” is an advisory body to the President. Its function is to formulate energy policies and guidelines designed to: I - Promote the rational use of energy resources in the country, in accordance with the provisions of applicable law and the following principles: • preservation of national interest; • promotion of sustainable development, expansion of the labor market and recovery of energy resources; • protection of consumer interests with respect to price, quality and availability of products; • environmental protection and promotion of energy conservation; • guarantee the supply of petroleum products throughout the national territory, in accordance with § 2 of Article 177 of the Constitution; • increasing the use of natural gas; • identifying the most appropriate solutions for the supply of electricity in different regions of the country; • use of renewable energy by taking advantage of available resources and applicable technologies; • promotion of free competition; • attraction of investment in energy production; • k. expansion of the country's competitiveness in international market;

15. CNPE II – ensure in terms of regional characteristics, the supply of energy to remote areas or difficult to access in the country, submitting the specific measures to Congress, when they imply in the creation of subsidies, as set forth in paragraph one of Article 73 of Law n . 9,478, in 1997I - promote the rational utilization of energy resources in the country, in accordance with the provisions of applicable law and the principles; III – periodically review the primary energy matrix applied to the various regions of the country, considering the conventional and alternative sources and technologies available; IV – establish guidelines for specific programs, such as natural gas, alcohol, other biomass, coal and thermonuclear energy; V – establish guidelines for the import and export so as to meet the needs of domestic consumption of petroleum and its derivatives, natural gas and condensate, and ensure the proper functioning of the National System of Fuel Stocks and the fulfillment of the Annual Plan for Strategic Fuel Stocks, mentioned in Article 4 of Law No. 8176 of February 8, 1991 . .

16. CMSE The Comitê de Monitoramento do Setor Elétrico (CMSE) was created by Law 10,848 of 2004, with the task of monitoring and evaluation permanently the continuity and security of electro energetic supplies throughout the country. I - follow the development of generation, transmission, distribution, marketing, import and export of electricity, natural gas and petroleum and its products; II - evaluate the conditions of supply and service, for the activities mentioned in item I of this article, over a predetermined period; III - periodically conduct an integrated analysis of security of supply and service to the market of electric power, natural gas and petroleum and its products; IV - identify difficulties and obstacles of technical, environmental, commercial, institutional order and others that affect or could affect the regularity and security of supply and execution of the expansion of the sectors of electricity, natural gas and petroleum and its products, and V - prepare proposals for adjustments, solutions and recommendations for preventive actions or to correct situations observed due to the activity indicated in item IV, seeking to maintain or restore security of supply and electro energetic service, forwarding them when appropriate, the Conselho Nacional de Política Energética - CNPE. .

17. Órgãos Reguladores The Agência Nacional de Energia Elétrica (Aneel), under the Ministry of Mines and Energy, was established by Law No. 9427 de1996. The agency has the responsibility to regulate and monitor the generation, transmission, distribution and sale of electricity, www.aneel.gov.br A Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (ANP), established in 1998 year by Decree No. 2455. Responsible for regulating and implementing the national policy for the energy sector from oil, natural gas and biofuels, according to the Petroleum Law (Law 9.478/1997). www.anp.gov.br

18. Execução Diretrizes CNPE Founded in March 2004, the Empresa de Pesquisa Energética (EPE), a public enterprise under the Ministry of Mines and Energy, aims to provide services in the area of studies and research to support the planning of the energy sector. Among the researches are electricity, oil and natural gas and its products, coal, renewable energy sources and energy efficiency www.epe.gov.br www.petrobras.com.br www.cprm.gov.br www.dnpm.gov.br www.eletrobras.com

19. EPE Brazilian Energy Balance year2010 Primary Energy Production: 241.100 x 103 tep https://ben.epe.gov.br/downloads/Relatorio_Final_BEN_2010.pdf

20. EPE 20 years Study of integrated planning of energy resources; Provides assistance for the formulation of a strategy for expanding the supply of economical and sustainable energy trying to fulfill the evolution of demand, according to a long-term perspective. 10 years The PDE is one of the main tools for energy planning, guiding decisions related to the balance and the country's economic growth. Elaborated with the assistance of agents working in the energy sector, the academic community and other segments of Brazilian society. https://ben.epe.gov.br/downloads/Relatorio_Final_BEN_2010.pdf

21. Energy Efficiency Law No. 10.295 - October 17th, 2001 - National Policy for Conservation and Rational Use of Energy Art. 1º Efficient allocation of energy resources and environmental preservation. Art. 2º The Executive will establish maximum levels of specific energy consumption, or minimum energy efficiency of machinery and apparatus Art. 3º Manufacturers and importers of machinery and energy-consuming devices are required to take the necessary steps to be obeyed the maximum levels of energy consumption and minimum energy efficiency, Art 4º Standards for Energy Efficiency in Buildings .

22. Energy Efficiency To promote the rationalization of production and consumption of electricity, in order to eliminate waste and reduce costs and investments. Created in December 1985 by the Ministries of Mines and Energy and Commerce and Industry, and managed by an Executive Secretariat subordinate to Eletrobras. On July 18, 1991, was transformed in a Government program, and expanded its scope and responsibilities.

23. Energy Efficiency Petrobras supports the technical and financial administration of the National Programme of Rational Use of Oil and Natural Gas - CONPET, created by the Federal Government in 1991 Promotes the development of an anti-wasteful use of nonrenewable natural resources, encourages the efficient use of energy in various sectors, with emphasis on transport, industries and homes, and develop environmental education. OBJECTIVES: Provide technical support to increase energy efficiency in end use of energy; Promote research and technological development; Reduce emissions of greenhouse gases in the atmosphere; Educate consumers about the importance of rational use of energy for sustainable development and improved quality of life; Rationalize the consumption of petroleum and natural gas.

24. Brazilian Labeling Program http://www.inmetro.gov.br/consumidor/pbe.asp The PBE is a program that, through informative labeling, aims to guide the consumer about the efficiency of some products sold in the country Objective: Encourage the rationalization of energy consumption by using more efficient products. Labeling allows consumers to evaluate the various products as to their energy efficiency and select the ones that will bring greater savings during its use.

25. Laws • No 9991 24th July 2000 • Establishes the obligation for investment in energy efficiency programs in the final use by the Brazilian companies distributing electricity. • No 4059 19th December 2001 • Procedures for the establishment of Indicators and Levels of Energy Efficiency • Accountability and Coordination: MME • Executor: Steering Committee of Energy Efficiency Indicators (CGIEE), composed of MME, MCT, MDIC, ANEEL, ANP, PROCEL CONPET, Society and Universities • No 4508 11th December 2002 • Minimum efficiencies for induction motors 1-250 Cv .

26. Energy Efficiency Plan • Premissas e Diretrizes consolidadas em fevereiro de 2011 após consulta pública • Objetivo: • Consolidar as estratégias operacionais vigentes que estão produzindo bons resultados, ampliando sua abrangência, e criar novas estratégias, com • vistas a garantir a perenidade de algumas medidas de EE e assim torná-las alternativas confiáveis e relevantes às opções de ampliação da oferta de energia no planejamento da expansão do setor energético nacional. • Implantação: • Planos de Trabalho plurianuais elaborados sob a responsabilidade do MME. .

27. Energy Efficiency Plan • Assumptions and Guidelines consolidated in February 2011 after public consultation • Objective: • Consolidate the existing operational strategies that are producing good results, expanding its reach, and create new strategies, with order to guarantee the survival of some measures of EE and thus make them relevant and reliable alternatives to the options for expanding supply of energy in planning the expansion of the national energy sector. • Implementation: • Multi-annual work plans prepared under the responsibility of the MME .

28. Energy Efficiency Plan • Content: • 1.PROJECTION OF POTENTIAL FOR CONSERVATION OF ELECTRICITY ........ • 2. LAWS AND REGULATIONS FOR ENERGY EFFICIENCY IN BRAZIL .. • 3. ENERGY EFFICIENCY FOR SECTORS OF INDUSTRY AND MICRO AND SMALL ENTERPRISES • 4. ENERGY EFFICIENCY FOR THE TRANSPORT SECTOR • 5. ENERGY EFFICIENCY IN EDUCATION • 6. PROCEL CONPET • 7. Brazilian Labeling Program - PBE • 8. BUILDINGS • 9. ENERGY EFFICIENCY IN PUBLIC BUILDINGS • 10. ENERGY EFFICIENCY IN LIGHTING • 11. ENERGY EFFICIENCY IN SANITATION • 12. ENERGY EFFICIENCY PROGRAMS IN SOLAR WATER HEATING • 13. ENERGY EFFICIENCY AND R & D • 14. MEASUREMENT AND VERIFICATION OF ENERGY EFFICIENCY PROJECTS (M & V) • 15. INTERNATIONAL PARTNERSHIPS • 16. FUNDING FOR ENERGY EFFICIENCY INITIATIVES • 17. REFERENCES .

29. Energy Efficiency Plan • For each item: • OBJECTIVE • BACKGROUND • PROPOSED LINES OF ACTION

30. References www.mme.gov.br www.aneel.gov.br www.anp.gov.br www.eletrobras.com www.petrobras.com.br www.cprm.gov.br www.dnpm.gov.br www.epe.gov.br www.utilipoint.com/issuealert/article.asp?id=3121