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ACCESS TO LP GAS FOR LOW INCOME HOUSEHOLDS. Paolo Ditta - Liquigás October 2009. Brazil, a continental-wide country. Europe: 10.4 MM km². Brazil: 8.5 MM km². 190 million inhabitants. 730 million inhabitants. 2. 2. Broader than Electric Power and Water. Annual Consume per inhabitant
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ACCESS TO LP GAS FOR LOW INCOME HOUSEHOLDS Paolo Ditta - Liquigás October 2009
Brazil, a continental-wide country Europe: 10.4 MM km² Brazil: 8.5 MM km² 190 million inhabitants 730 million inhabitants 2 2
Broader than Electric Power and Water Annual Consume per inhabitant 25.8 kg* LPG in Brazil • LPG is present at 100 percent of Brazilian municipalities 5,563 municipalities 37,000 Authorized Distributors * Source: IBGE and ANP 2008 3 3
LPG in BrazilDistribution under Extreme Conditions Foto original Portability 5 5 5
LPG Availability Since LPG is always available within the Brazilian Territory, why is its use so low?
13% 12% 12% 12% 5.0 4.9 4.9 4.9 4.8 9% 9% 10% 10% 4.7 8% 4.8 4.8 29.5 4.6 28.7 27.1 26.3 25.9 25.9 25.9 25.8 25.7 LPG P-13 Consume – million tons. P-13 Compared to Minimum Wage - % LPG Consume – Kg/inhabitant/year LPG in Brazil Consume directly related to income 2000 2001 2002 2003 2004 2005 2006 2007 2008 Source: Empresa de pesquisa energética - EPE |MINISTÉRIO DE MINAS E ENERGIA -MME 7 7
Firewood - % LGP - % 48.2 35.1 26.5 26.2 LPG in BrazilFirewood in the Brazilian Energy Portfolio Residential Sector 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: Balanço Energético Nacional 2008 |Year base 2006 8 8
Lack of proper credit instruments P-13 cylinder cost is high for low-income people Consume Barriers
Flex Stove Consume Barriers
Flex Stove Consume Barriers
1,453 1,431 1,414 1,401 1,348 1,355 1,304 1,290 1,234 374 361 343 339 324 321 310 307 297 NORTH NORTHEAST North and Northeast Consume LPG Consume in thousands of tons 2000 2001 2002 2003 2004 2005 2006 2007 2008 Source: Authorized Fuel Distributors in accordance with ANP Administrative Rule ANP 202/99. Notes: Data source before 2006: Product Control Statement (Demonstrativo de Controle de Produtos - DCP). From 2007: Data from Products Movement and Information System (Sistema de Informações de Movimentação de Produtos – SIMP). Before 2006 information considers sales, including distributors’ consume. From 2007 only sales is considered. 12
LPG ConsumeAverage Annual Growth GDP Brazil Brazil 2000-2005 +3.05% 2000-2005 -0.94% 2005-2008 +4.53% 2005-2008 +1.08% Northeast 2000-2005 -1.96% 2005-2008 +3.03% North 2000-2005 -2.30% 2005-2008 +3.30% Southeast 2000-2005 -0.20% 2005-2008 +0.05% Central-West 2000-2005 -1.00% 2005-2008 +1.05% South 2000-2005 -0.90% 2005-2008 +0.18% Source: ANP 13
Consume ImpulseNorth and Northeast Regions • Economic growth generates employment growth • Supplementary income through governmental mechanisms • Example/For instance: Family Grant Program
Consume ImpulseGovernment Role in the Problem Resolution • Tax reduction for home appliance products
Consume ImpulseLiquigás Role in the Problem Resolution P-08 P-05
Sector Future Challenges • To develop mechanisms in order to grant subsidies to those who cannot afford the use of LPG. • To ensure that subsidies are properly spent on LPG • Microloans for low-income people
End of Indoor Pollution Public Health Cost Reduction Safety Benefits
Paolo Ditta - Liquigás Outubro 2009 Liquigás is a Company of Petrobras’ System