Essay
HERMES J. CHIPP was Operations, Planning & Scheduling Director at ONS – Operador Nacional do Sistema Elétrico – from
its foundation in 1998, and has been the General Director of ONS since 2005. An electrical engineering graduate of UFRJ
(Rio de Janeiro Federal University), he also did postgraduate work in Power System Engineering at GE/Union College in
Schenectady, New York. Chipp is former Vice President and President of the international organization VLPGO (Very Large
Power Grid Operators) and former Vice President of CIER (Comisión de Integración Energética Regional). He has also held
executive positions at ELETROBRAS – the Brazilian Federal Government Power Utilities Holding, simultaneously working
with GCOI (Coordinating Group for the Interconnected Operation of the Power System), for which he served as coordinator
of the electrical studies working group and subcommittee, and later executive secretary. In the 1990s, Chipp led working
groups for the Brazilian Power Sector Restructuring Project.
Illustration by BURKHARD NEIE
Brazil: a Diverse Energy Giant
With its hydrobasins offering huge hydropotential, Brazil has traditionally
developed hydropower for its energy needs. Today, environmental concerns
have led to constraints to building new hydropower reservoirs, thermal
plants, and new transmission lines. Therefore, government policies have
been oriented to the diversification of the country’s energy matrix, including
developing its significant potential in biomass and wind energy and – using
ecologically sound technology – also hydro, natural gas, coal, nuclear and
oil power plants.
By Hermes J. Chipp, General Director of ONS – Operador Nacional do Sistema Elétrico
The past decade set the stage for significant
changes in Brazilian economy and society. Governments committed to democratic stability, free
market mechanisms, and social reform have
slowly steered the country towards the path of
sustained economic growth, culminating in an
increase in GDP of about 7.5 percent in 2010. At
the same time, the country’s newfound confidence and its burgeoning influence in the international arena are creating both opportunities
and challenges. Brazilians are justly celebrating
60 Living Energy · Issue 5 /July 2011 · www.siemens.com/energy/living-energy
the chance of organizing a FIFA Soccer World
Cup in 2014 and the 2016 Olympics, but it is
clear that in order to keep an adequate pace of
growth and manage such massive events successfully, Brazil’s energy infrastructure will
have to meet unprecedented demands.
Today, Brazil has one of the cleanest energy matrixes on the globe, thanks largely to its traditional reliance on hydropower. In the coming
decades, however, the pressure and the need to
keep a low-carbon economy are expected to play
Essay
Facts & Figures
Brazil is the largest Latin American country in land surface
area, population (over 190 million people in the 2010 census),
and GDP (US$2.18 trillion, although the per capita figure is just
over US$11,000, similar to countries like Libya and Lithuania).
It is the world’s seventh-largest economy in terms of purchasing power parity (PPP).
Brazil’s economic size is naturally reflected in energy consumption: The country is the world’s tenth-largest energy consumer, and its fourth-largest carbon dioxide emitter. Most of
those emissions (57.5 percent) come from deforestation, and
are therefore relatively easy to mitigate. Emissions from agriculture come next (22.1 percent of the total amount), followed
by energy emissions (16.4 percent). Annual inventories are not
available – the data refers to 2005.
The discovery and exploitation of hydrocarbon energy sources
have increased dramatically in the last couple of decades. Brazil is now the 15th-largest oil producer in the world – in 2006,
the national output was a little above 11.2 billion barrels. The
country has become a net exporter of oil this year, but there are
still some imports of light oil from the Middle East because of
the infrastructure of certain refineries that are unsuited for the
processing of the heavier oil found in Brazilian territory or territorial waters. Natural gas supplies, on the other hand, still have
to be supplemented by imports from Bolivia and Argentina, for
example. Coal reserves amount to about 30 billion tons.
Also significant are Brazil’s uranium reserves – the sixth largest in the world, distributed across eight states. Despite this
asset, plans for a greater share of nuclear power in the country’s energy matrix have been slow to materialize, and there is
considerable public opposition to such an idea.
a significant role in any country’s international
standing, and all the more so in the case of Brazil.
Juggling all of these sometimes conflicting demands will be a difficult balancing act, but one
can be confident that Brazilian society will be
able to pull it off. Energy generation and transmission will have to expand on a diverse and
flexible basis, building upon the country’s current strengths without fear of innovation – of
going into somewhat uncharted territory. The
diversity of available natural and human resources in Brazil’s vast land mass can be harnessed in a way that may benefit both the economy and the environment.
The development and strengthening of a biofuel portfolio has
enjoyed much more support. With both the largest sugarcane crop and the biggest exports of ethanol in the word,
Brazil has also developed the so-called “flex” technology, with
which drivers can fill up their cars alternatively with gasoline
and/or ethanol – even mixing the two fuels. The “flex” models
of cars are now the default in most of the country. The refuse
from the sugarcane industry is also showing promising results
in biomass energy facilities, and there has been progress in
the production of biodiesel and its incorporation in diesel from
fossil sources. Natural-gas-fueled vehicles are also quite
common.
Solar and wind energy are still largely untapped, despite their
huge potential in a country with Brazil’s climatic conditions.
That will soon change dramatically, however. By 2015, while
the relative participation of hydropower in the Brazilian
energy matrix is set to decrease slightly from 79.3 percent
to 71 percent, the presence of wind energy is expected to rise
to 3.8 percent – almost the same proportion as that of oil in
the current energy matrix and amounting to an increase from
3.9 to 7.3 percent.
While the use of oil and coal is also expected to increase significantly – by 138 percent and 127 percent respectively – their
relative shares compared to other energy sources would be
just 7.3 percent and 2.3 percent, probably not enough to justify concerns of a “carbonizing” Brazilian energy matrix. Nonetheless, industry and academia are already discussing carbon
storage and capture (CSS) schemes in connection with future
thermoelectric facilities, although the costs are still a liability
for any such mitigation measure.
Rivers of Dreams
Energy Generation by Source (MW and %)
Hydro
2015
Hydro
79.3%
85,690
97,968
71.0%
1.5% Nuclear
2,007
8.9%
12,257
1.9% Nuclear
Coal
2,007
8.6%
5.3%
Gas/LNG
4.2%
3.9%
Wind
826
0.8%
3.8%
7.3%
1.3% 1,415
Biomass
4,577
Oil
4,211
2.3% 3,205
Biomass
9,308
Coal
Gas/LNG
Wind
5,194
Oil
10,011
7,271
Source: ONS Annual Energy Planning – PEN – 2010/2015
Graphics: independent
2010
The predominance of hydropower in Brazil’s
current energy matrix (it amounted to 79.3 percent of the country’s installed capacity last year
and, by means of operations optimization,
achieved a 90 percent average over the last decade) is natural enough when one looks at it in
terms of Brazilian history, when the country’s
economic powerhouse throughout the 19th and
20th centuries was initially exporting agricultural commodities, mainly coffee, and then going
through a significant phase of industrialization.
There are a dozen hydrobasins in the Brazilian
Highlands suited for hydropower exploitation.
In the late 1950s, Brazil accelerated its hydropower program, mainly in the southeastern and
southern states, concentrated in the Grande,
Paranaíba, Paraná and Iguaçú River Basins.
Meanwhile, exploitation of the São Francisco
River Basin, traversing part of the southeastern
and most of the northeastern regions, was begun. Later, in the 1980s, exploitation of the Amazon River Basins began with the most easterly
of them, the Tocantins River Basin. By that time,
the Uruguay River Basin hydroplants were beginning to be built, as well as new plants with
run-of-the-river capacity, in the mature basins.
That is one of the main reasons why hydropower
became such a fundamental part of Brazilian energy policy. Another reason, as we shall see, was
the 1973 global oil crisis and the need for the
country to wean itself away from hydrocarbon
energy sources at a time when its oil production
was just a small fraction of what it is today. A
vigorous program of dam building ensued, culminating in the construction of the Itaipu Dam
on the border between Paraguay and the Brazilian state of Paraná. Itaipu began operations in
May 1984, and it is still the largest operating hydroelectric facility in the world in terms of annual
generating capacity, 91.6 TWh in 2009.
Itaipu and other large hydroelectric facilities built
at the time had huge reservoirs. Flooding an extensive area of land was deemed necessary as insurance against the diminished levels of the dam’s
water during the dry season (most of Brazil, as a
rough approximation, can be said to have basically
a dry season and a wet season, despite regional
variability). Massive reservoirs help to provide a
steady flow of water, which is crucial to a yearround capability for energy generation.
Environmental concerns have changed, and the
new generation of hydroelectric facilities in Brazil
will follow suit. The backbone of the country’s energy system expansion is a network of plants in the
Amazon region, two of which are already under
construction in the Madeira River (the Santo Antônio and Jirau power plants), and one is planned
“The diversity of natural
and human resources in
Brazil can be harnessed in
a way that may benefit
both the economy and the
environment.”
in the Xingu River (the Belo Monte power plant).
Controversy with environmental and indigenous groups has surrounded the three projects,
but there is no denying they are a dramatic improvement on the previous model, mainly because they are not based on the concept of huge
water reservoirs. The Madeira River power plant
dams are good examples of this new model. This
means that those plants will need to flood just a
little over 100 square kilometers of the Madeira
flood plain, respectively. It is practically the same
area that the river would naturally flood in the
Amazonian wet season. That also applies in the
case of the Tapajós-Teles Pires Basin, which will
be the next to be exploited. Thus, the environmental advantages are obvious.
In Short
Reliable Heat
In terms of cost, hydropower will continue to be
the least expensive energy source in Brazil for
quite some time, amounting to less than US$50
per MWh. There is a different price to pay in the
new model for hydroelectric facilities, though.
Their design involves a natural decrease in reliability of generation, especially when the rain
season is not favorable and, of course, during
the dry season. That is why a diversification of
the Brazilian energy matrix, particularly with
the thermoelectric facilities component, as well
as other plants fueled by renewable sources, are
key to the safety of the system as a whole.
Fortunately, the country also has what could be
fairly said to be a privileged position in that regard. In the last couple of decades, thanks largely to the efforts of the state company Petrobras,
Brazil has achieved a major leap in its oil and
natural gas production. With the exploration of
the extremely deep presalt layer off the coast
during this decade and the next, it’s fair to expect a much more comfortable situation in
terms of fossil fuels supply for the foreseeable
future. At the same time, a flourishing ethanol
industry – building upon the tradition of sugarcane agriculture in the country and originally
stimulated by the government as a means to
further reduce the national reliance in hydrocarbon sources – has made Brazil a leader in
biomass production. And it must not be forgotten that the southern state of Santa Catarina
possesses important reserves of coal.
All this is auspicious news for the reliability of
the Brazilian energy system, if we manage to
use thermoelectric facilities as a way to supple-
Efficient
Solutions
for Unconventional
Gas
The subsea grid from Siemens: a safe, reliable, environmentally
friendly solution for the oil and gas industry.
Siemens Strengthens
Position in Subsea
Power Market
Photo: XXXXXX
Siemens
“In terms of cost, hydropower will continue to
be the least expensive
energy source in Brazil
for quite some time.”
ment the low points of hydropower generation
rationally. That could be done without making
our energy matrix significantly dirtier (see Facts
& Figures). Furthermore, the use of thermoelectric energy fired by renewable sources is promising when we look at the potential complementarity between biomass and hydropower. The
sugarcane harvest goes from May to October –
almost exactly coinciding with the dry season in
most of the Brazilian territory, and particularly
in the southeast, where energy demands are
most exacting.
Wind energy is another nearly untapped source
in Brazil, with great potential to increase regional energy generation in a clean way. The vast
Brazilian shore, particularly in the northeastern
states, is at least theoretically in a better position to exploit wind power than most sites in Europe that are leaders in the field today. That has
to do mainly with natural conditions that seem
to make the Brazilian winds less prone to generate fluctuations in the power system’s production. In terms of price, the current tendencies
indicate that wind power may soon become as
competitive as thermoelectric energy.
A challenge to this purpose is to integrate what
we hope would be a diverse and flexible matrix
in a national system that is both interconnected
and able – for example under extreme climatic
circumstances – to behave regionally in an independent way, so that disruptions will not swamp
the entire system. To that end, huge advances in
transmission (an increase of 36,000 kilometers
in extra-high-voltage transmission lines – 230 kV
and higher, or around 30 percent of the existing
network – in just twelve years) are a major focus.
Particularly significant for the Madeira power
plants, and probably for the Belo Monte power
plant interconnection to the main grid, is the
use of DC transmission links, as well as the integration of the Itaipu power plant into the Brazilian grid. During the last few years, this very
large, fast-growing transmission grid has been
equipped with the so-called smart grid equipment and control systems, and no doubt this
will be progressively implemented.
Finally, it should be mentioned that the most
important current challenges to the operation of
the Brazilian power system are the integration
of very geographically sparse renewable-energysourced power plants, the operation of the long,
high-capacity DC links, and – last but not least –
the linking, both legal and operational, of the
Brazilian power system to those of neighboring
countries, especially in the Southern Cone.
Siemens has acquired Norwegian
subsea specialists Bennex Group AS
and Poseidon Group AS. Bennex
develops and manufactures subsea
components such as marinized cable
connections for power supply to oil
and gas production operations at
depths of as much as 3,000 meters.
Poseidon Group AS provides subsea
marinization, engineering and consulting for companies in the oil and
gas industry and is capable of marinizing existing Siemens equipment and
technology to the subsea environment. The two companies posted
combined revenues of €75 million
in 2009.
“Subsea processing is a fast-growing
and technologically challenging
market in the oil and gas industry,”
says Tom Blades, CEO of the Siemens
Oil and Gas Division. “With the acquisition of Poseidon and Bennex, we’re
strengthening our portfolio and
competence in subsea power grids.”
Siemens anticipates that the subsea
market will enjoy double-digit
growth, especially in power grid applications, to become a multibillion
market in 2020.
Siemens has received an
order to supply up to ten
compressor trains to Australia Pacific LNG (APLNG) in
Queensland, Australia, with
delivery starting in early
2012. Each compressor
train consists of two compressor skids, one low pressure and one high pressure.
The trains are designed to
transport about 84 million
standard cubic feet of gas
per day.
The APLNG project involves
the development of coal
seam gas fields in south
central Queensland over a
30-year period and includes
construction of upstream
gas-gathering and processing facilities as well as a
450-kilometer main transmission pipeline from the
gas fields to the facility being built on Curtis Island
near Gladstone, where it will
be compressed and cooled
into liquefied natural gas.
Coal seam gas is a natural
gas which is mainly composed of methane. It is a
by-product of ancient plant
matter that has formed over
millions of years by the
same natural processes
which produce coal.
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