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Renewable Energy Trade Mission

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AGENCY:

International Trade Administration, Department of Commerce.

ACTION:

Notice to Renewable Energy Trade Mission to Brazil, October 17-19, 2005.

SUMMARY:

The United States Department of Commerce, International Trade Administration, U.S. Commercial Service is organizing a Renewable Energy Trade Mission to Brazil, October 17-19, 2005, to help U.S. firms find business partners and sell renewable Start Printed Page 38104energy equipment and services in Rio de Janeiro, São Paulo, and Salvador da Bahia. Targeted sectors include hydro, wind, solar, bio-diesel and biomass.

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FOR FURTHER INFORMATION CONTACT:

Office of Global Trade Programs; Room 2012; Department of Commerce; Washington, DC 20230; Tel: (202) 482-4457; Fax: (202) 482-0178.

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SUPPLEMENTARY INFORMATION:

Renewable Energy Trade Mission, Brazil, October 17-19, 2005.

Mission Statement

I. Description of the Mission

The United States Department of Commerce, International Trade Administration, U.S. Commercial Service is organizing a Renewable Energy Trade Mission to Brazil, October 17-19, 2005, to help U.S. firms find business partners and sell renewable energy equipment and services in Rio de Janeiro, São Paulo, and Salvador da Bahia. Targeted sectors include hydro, wind, solar, bio-diesel and biomass. The mission, to be led by a U.S. Department of Commerce official, will include business-to-business matchmaking with local companies and meetings with key government officials. Representatives of the Overseas Private Investment Corporation (OPIC) and the U.S. Agency for International Development (USAID) will be on hand to provide information and counseling on their programs.

II. Commercial Setting for the Mission

The renewable energy sector in Brazil holds enormous potential for development over the next four years, given the country's wealth of natural resources for wind, biomass, solar and hydro projects, and the Brazilian government's Incentive Program for Alternative Electric Energy Sources (PROINFA), which aims to install by 2008 small hydro, wind, and biomass facilities capable of generating 3,300 MW. (PROINFA defines small hydropower projects as having a maximum installed capacity of 30 MW.) This program is expected to attract more than US$2 billion in investments from 2005 to 2008.

Small hydropower plants have commanded critical attention since the 2001 energy crisis and the implementation of PROINFA. Brazil has a long tradition of hydropower generation, from both small and large plants. The generation of 1,100 MW in new PROINFA projects is already approved, and many Brazilian companies are investing in small hydro projects that are not part of PROINFA. While most demand is currently supplied by subsidiaries of such companies as GE, Siemens, ABB and Alstom, there are opportunities for sales of selected components.

Wind energy is also a priority growth sector. Even the most conservative estimates put the potential for wind power production at more than 70,000 MW—nearly equal to Brazil's entire generating capacity (90,000 MW). There are many small wind power plants operating in Brazil, especially in the states of Ceará and Rio Grande do Sul. The 1,100 MW approved under PROINFA will be installed between 2005 and 2008. There is currently only one manufacturer of large-scale wind power plants operating in Brazil, a subsidiary of the German firm Enercon.

Solar power offers enormous development opportunities in Brazil, which has one of the world's most abundant solar energy resources and has only just begun to explore its potential. The use of solar water heaters in Brazil has increased rapidly in the last few years, with nearly 140 Brazilian manufacturers producing these products for residences, hotels, hospitals, and swimming pools. Most are very small companies.

Photovoltaic technology (PV) is a competitive alternative to grid extension in remote areas of the country and in applications of social interest. The power needs of rural off-grid communities are relatively modest and therefore compatible with stand-alone PV systems. Estimates indicate that 5% to 10% of the non-electrified domiciles (about 250,000) could be supplied with PV systems. The main PV applications in Brazil have been off-grid residences, public services, water pumping, and telecommunications. There are many initiatives underway utilizing stand-alone PV systems, more than 30,000 of them purchased for rural electrification.

Biomass is a growth sector supported by Brazil's ambitious program for manufacturing bio-diesel from vegetable oils. The country plans to replace 2% of its diesel consumption through bio-diesel starting in June 2005 and increase this rate to 5% in 2009, primarily through use of castor oil and palm oil. Total consumption of fossil diesel is currently 38 billion liters/year.

Brazil is the world's largest producer of sugarcane and ethanol. It has one of the most technologically advanced programs of bio-fuels of the world, in development since the 1970s. More than 3 million cars are powered exclusively by hydrated ethanol, consuming more than 5 billion liters/year. In addition, most gas sold contains 20%-25% anhydrous ethanol (production of 6 billion liters/year), the highest percentage mix in the world. It is expected that domestic and export demand for ethanol will continue to rise. The installed power of cogeneration in the sugar cane industry is approximately 1800 MW. Note that the bio-diesel and ethanol programs do not fall under the PROINFA project, which is only for grid-connected electricity.

Brazil also has very large planted forests, mainly of eucalyptus and pine, especially for the cellulose and charcoal industries. As these sectors are growing at very high rates, a shortage of eucalyptus is expected over the next few years. The total capacity for pulp is about 10 million tons/year, and for paper 9 million. Production from cellulose plants meets about 85% of electricity needs, and paper operations meet about 10%, whereas cogeneration from integrated paper and pulp plants meets about 60%. Under PROINFA, most approved biomass projects are for sugarcane bagasse, but there has also been interest in rice hulls, orange bagasse, wood chips, wood residues and fiber of palm oil kernels.

PROINFA: Under PROINFA, the Brazilian Government, through its holding company Eletrobras, has already selected projects eligible to sell energy to the national grid in 20-year contracts with independent producers. Projects may have up to 80% of equity financed through subsidized loans from the Federal Economic and Social Development Bank (BNDES). A special US$280 million fund called “Brasil Energia,” set up by private pension funds and BNDES, offers financing to project sponsors selected under PROINFA. To qualify for PROINFA financing, a minimum of 60% of the project procurement must be of Brazilian-made equipment.

After this goal of 3,300 MW is installed, a second phase of PROINFA will immediately follow to ensure that in 20 years wind, biomass and small hydropower systems supply 10% of Brazil's annual electric power consumption. For this second phase, only projects with a minimum of 90% Brazilian-made components will be eligible for BNDES financing.

“Light For All” (Luz Para Todos), another of the Brazilian Federal government's important projects, has set a goal to achieve universal access to safe and affordable energy as a key element in its fight against rural poverty. There are currently nearly 18 million Brazilians living in remote communities without reliable access to electricity. In the Amazon region, there are more than 1,000 mini power plants, most of which use diesel oil to supply electricity to isolated villages. Many of them are old Start Printed Page 38105and inefficient. The need to serve this region is expected to create more opportunities for companies offering innovative and efficient technologies.

III. Goals for the Mission

The goal of the Renewable Energy Trade Mission to Brazil is to provide U.S. participants with first-hand market information, access to government decision makers, and one-on-one meetings with business contacts, including potential agents, distributors and partners, so they can position themselves to enter or expand their presence in the Brazilian market.

IV. Scenario for the Mission

The Renewable Energy Trade Mission will include three stops: Rio de Janeiro, São Paulo and Salvador da Bahia. In each city, participants will meet with potential business partners, customers, end-users and agents/distributors through one-on-one meetings and other activities, including regulatory meetings with high-ranking federal and state officials involved in this sector.

Timetable

The full program includes Rio de Janeiro, São Paulo, and Salvador da Bahia. Members of the delegation who opt to visit additional cities, return to Rio, or remain in São Paulo instead of traveling to Salvador may pay an additional US$400 for Gold Key Service appointments. This fee is exclusive of interpreter and transportation costs, estimated at US$200.

Rio de Janeiro

October 16, 2005

Arrive Rio de Janeiro

October 17, 2005

Market briefing

One-on-one business appointments

Evening departure to São Paulo

São Paulo

October 18, 2005

One-on-one business appointments

Salvador da Bahia

October 19, 2005

Morning departure to Salvador de Bahia

Afternoon business appointments

V. Criteria for Participant Selection

  • Relevance of a company's business line to mission goals.
  • Timeliness of the company's signed application and participation agreement (including the participation fees).
  • Minimum of 7 and a maximum of 25 participating companies on the mission (a maximum of 10 firms with an existing local office in Brazil will be accepted).
  • Potential for business in Brazil for the company.
  • Provision of adequate information on the company's products and/or services, and the company's primary market objectives, in order to facilitate appropriate matching with potential business partners.
  • Certification that the company meets Departmental guidelines for participation. Generally, a company's products or services should be either produced in the United States, or, if not, marketed under the name of a U.S. firm and have at least 51 percent U.S. content of the value of the finished product or service.

The participation fee is $3,200 per firm, which includes one representative. The fee for each additional firm representative is $750. The option to participate in the trade mission is also being offered to U.S.-based firms in Brazil; the same fee structure applies.

Any partisan political activities (including political contributions) of an applicant are entirely irrelevant to the selection process.

Mission recruitment will be conducted in an open and public manner, including publication in the Federal Register, posting on the Commerce Department trade mission calendar—http://www.ita.doc.gov/​doctm/​tmcal.html—and other Internet Web sites, press releases to general and trade media, direct mail, broadcast fax, notices by industry trade associations and other multiplier groups, and publicity at industry meetings, symposia, conferences, and trade shows. The American Council on Renewable Energy (ACORE) and the Business Council for Sustainable Energy (BCSE) plan to publicize the mission to their members. The Commercial Service will explore and welcome outreach assistance from other interested organizations.

Recruitment for the mission will begin in June and conclude September 5, 2005. Applications received after that date will be considered only if space and scheduling constraints permit.

Contacts:

Eugene Quinn, Senior International Trade Specialist, Global Trade Programs (GTP), Renewable Energy Trade Mission Project Officer, Ph: 202-482-0578 / Fax: 202-482-0973, eugene.quinn@mail.doc.gov.

Wake Margo, International Trade Specialist, Global Trade Programs (GTP), Ph: 202 482 2026 / Fax: 202-482-0973, wake.margo@mail.doc.gov.

Contacts for U.S.-based Firms With a Presence in Brazil:

John Mueller, Commercial Director, U.S. Commercial Service, Belo Horizonte, Brazil, Tel: (55-31) 3213-1571 / Fax: (55-31) 3213-1575, john.mueller@mail.doc.gov.

Mauricio Vasconcelos, International Trade Specialist, U.S. Commercial Service, Belo Horizonte, Brazil, Tel.: (55-31) 3213-1573 / Fax: (55-31) 3213-1575, mauricio.vasconcelos@mail.doc.gov.

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Dated: June 24, 2005.

Donald Businger,

Director, Office of Trade Event Programs.

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[FR Doc. E5-3469 Filed 6-30-05; 8:45 am]

BILLING CODE 3510-DR-P