By Renata Freitas and Reese Ewing
SAO PAULO, Brazil (Reuters) - Utilities group Energias do Brasil (ENBR3.SA: Quote, Profile, Research, Stock Buzz) said on Monday it sees great potential for investment in Brazil, Latin America's largest economy, and said it plans to focus on expanding the group's generation capacity.
"We consider it attractive to invest in generation because it is a necessity for the country," Energias do Brasil President Antonio Martins da Costa said at the Reuters Latin America Investment Summit in Sao Paulo.
Da Costa said the demand for energy and need for investments in energy generation would allow Energias do Brasil to account for a growing share of earnings before interest, taxes and amortization for its parent company, Energias de Portugal (EDP) (EDP.LS: Quote, Profile, Research, Stock Buzz), in the coming years.
Energias do Brasil currently accounts for almost 20 percent of EDP's core earnings but this is expected to grow quickly to around 30 percent, da Costa said.
"EDP investments have fundamentally been in Europe -- Portugal, Spain. Portugal and Spain are mature European markets, that is they don't have a great potential for growth," said da Costa.
"In Brazil, the capacity for generation has to grow. It's hard to say specifically but in two to three years Brazil could account for 30 percent (of EDP's core earnings)," he said, adding that new investments in transmission in Brazil were unlikely in the near term.
Currently, the group's revenues in Brazil are derived 80 percent from transmission and 20 percent from generation. When its Peixe Angical plant comes on line, generation revenues will rise to 25 percent. State-run energy firm Furnas is a 40 percent shareholder in the Peixe Angical project.
ENERGY AUCTION Continued...
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