1 Henrique Valladares ODEBRECHT – Senior VP. Brazilian – American Chamber of Commerce, Inc. June 23 rd, 2008

2 Outline Global energy challenges Hydropower in the world Hydropower in South America Hydropower in Brazil

3 The challenge The new challenges of energy environment have placed energy at the top of the world’s agenda The supply of an energy-hungry society has by itself been one of the world’s greatest challenges Quadrillion BTU Source EIA

4 The role of hydropower Hydropower may play a significant role in all two dimensions of the energy challenge –Economics –Environment

5 Global hydro potential HYDROELECTRIC RESOURCES TOTAL THEORETICAL CAPABILITY Referred Countries (26,294 TWh/year) Remaining Countries (14,410 TWh/year) 65% Worldwide (40,704 TWh/year) Souce WORLD ENERGY TWh/yr

Hydro potential: geographical distribution Main technically available potentials Canada 7% USA 4% Brazil 10% Congo 5% India 5% China 13% Russia 12%

7 % of hydro development Opportunity for emerging countries World exploited capacity % of technically feasible power Based on World Energy Council.

8 South America Population: 370 million GDP: US$ 4.3 trillion* Installed capacity: 270 GW 51% hydro 49% thermal * 2007 Figures, Power Purchase Parity Brazil Guyana Suriname French Guyana Uruguay Chile Bolivia Paraguay Argentina Peru Ecuador Colombia Venezuela

9 Brazil: highlights Surface area: 8.5 million km 2 (= continental US + 1/2 Alaska) Population: 185 million (50% S. America) Installed capacity (2007): 100 GW Production (2006): 50 average GW (55% of South America) Peak load: 64 GW (Comparable to UK or Italy) Brazil Argentina Peru Colombia Venezuela Bolivia Uruguay Paraguay Chile Ecuador Suriname

Brazil – Expansion MWh x ,8 101,5 105,3 106,9 96,8 3,8 1,6 3,3 101,5 105,3 106,9 110,2 90,7 92,9 Source: Secretaria de Planejamento e Desenvolvimento Energético - MME GENERATION EXPANSION: 3,771 MW AVERAGE/YR UP TO 2010

JAN / 2006 Mainly hydroelectricity: DEC / MW MW 73% INCREASE OF 44% DURING NEXT 10 Yrs. ENERGY MATRIX Brazil – Expansion

Brazil – New Frontiers SOUTH POTENTIAL 43 GW 16% Exploited 46.3% SOUTHEAST POTENTIAL 45 GW 17% Exploited 52.2% NORTHEAST POTENTIAL 26 GW 10% Exploited 42% CENTER - WEST POTENTIAL 35 GW 13% Exploited 28.1% BRAZILIAN HYDROELECTRIC POTENTIAL BRAZIL POTENTIAL: 261 GW EXPLOITED: 28.2% 50% Itaipu, included Source: Potential Total EPE 2006 Potential Exploited: EPE/MME, 2006 NORTH POTENTIAL 112 GW 43% Exploited 8,9%

Brazil - Enviroment Projects Km 2 /MW EXISTING0,51 PLANNED (AVERAGE PERIOD analyzed)0,29 MAIN NEW PROJECTS BELO MONTE0,04 JIRAU0,11 SANTO ANTÔNIO0,11 Flooded area / Installed capacity - ratio

Brazil - Basins HYDROELECTRIC INVENTORIES IN EXECUTION TAPAJ Ó S JUREANA5.000 ARAGUAIA3.100 ARIPUANÃ3.000 TROMBETAS3.000 BRANCO2.000 JARI1.100 SUCUNDURI650 JATAPU650 ITACAI Ú NAS450 T O T A L HYDROGRAPHIC BASIN ESTIMATED POWER (MW) ITACAIÚNAS ARAGUAIA BRANCO JATAPU TAPAJOS SUCUNDURI ARIPUANÃ JURUENA TROMBETAS JARI

Brazil – projects in feasibility studies CACHOEIRA PORTEIRA BELO MONTE APIACÁS S.JOÃO DA BARRA PRAINHA TABAJARA SÃO LUIZ TELES PIRES MARABÁ PROJECTPOWER (MW) BELO MONTE SÃO LUIZ TELES PIRES MARAB Á S.JOÃO DA BARRA PRAINHA C. PORTEIRA TABAJARA 350 APIAC Á S 275 T O T A L FEASIBILITY STUDIES IN AMAZON REGION

16 Generation Thermal and others (27%) System dispatch Hydro plants are operated as a portfolio Hydro (73%) Large plants in cascade over different basins Interconnections with Argentina and Paraguay total of MW

17 Transmission network The country is interconnected by 80,000 km of HV lines (>230 kV) 2,200 MW interconnection with Argentina (>230 kV) Long transmission lines (> 1,000 km) (>230 kV) 15,000 km of new lines added in the past five years (>230 kV) 40,000 km to be added up to 2015 (>230 kV) Source: ONS, km 4320 km

Brazil - Investments GOVERNMENT (ELETROBRAS) PRIVATE ( ACENDE BRASIL) After TOTAL Investments for energy generation (US$ billions) Investments in energy (US$ billions) 2.3* * WORLD BANK

19 Importance of hydropower in Brazil It is 73% of the energy matrix Substitutes importation and consumption of fossil fuels Diminishes CO2 emissions Integrates different hydrologic regimes It is a renewable asset Increases the fluvial transportation

BRAZILIAN CAPABILITIES Brazil has full capability for engineering any Hydroproject. Brazil has full capability for the civil and erection services nedded and for performing abroad. Brazil has full capability of supplying the electromechanical equipment for his projects and export

Odebrecht Odebrecht has participated in the construction of a Total of 52.3 GW ( 49.7 GW in Brasil and 2.6 GW abroad ) Odebrecht has been for the last 5 years the number one in the ranking of International Contractors in Hydroplants (ENR)

Hydroelectricity – Brazil - ODEBRECHT Thank You