BMI View: Brazil's power sector continues to present the risk of political uncertainty and a weak economicrecovery, but its long-term potential remains unparalleled in Latin America. The government has promisedto hold two capacity auctions in December 2017, which will create opportunities for project developers,particularly in the non-hydro renewables sector. Meanwhile, government plans of privatising powerdistribution companies and selling shares in Eletrobras will also offer investors an opportunity to increaseexposure to the Brazilian power sector.
Latest Updates And Structural Trends
Growth in the Brazilian power industry has been negatively affected by the recession the country hasexperienced in 2015-2016 and the current economic malaise. Nevertheless, Brazil continues to holdtremendous potential in terms of natural resources for power generation and future energy needs. TheTemer government is committed to re-igniting growth in the country's power sector by holding capacityauctions on a regular basis, with the first to take place in December 2017. According to the 10-yearenergy plan the government released in July 2017 (the PDE2026), growth will concentrate in the nonhydrorenewables sector and in the development of natural gas-fired thermal power plants.